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Judge denies Citigroup’s request to overturn $54 million ruling

Citigroup will still have to pay damages and fees to investors

A U.S. judge smacked down Citigroup on Wednesday, denying its request to overturn a ruling that will cost the company $54.1 million in damages and fees. The judge upheld the Financial Industry Regulatory Authority (FINRA) arbitration panel’s decision in favor of a group of investors who incurred losses when municipal bond funds in which they invested took a nosedive between 2007 and 2008.

Citigroup sold the funds through MAT Finance, which borrowed at low, short-term rates and then invested those proceeds into long-term muni bonds, Thomson Reuters reports. As it turned out, this was not a great strategy, and investors sustained losses of up to 80 percent.

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