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FINRA Shakes Citi Unit For $54M Over Hedge Funds

Law360 (April 12, 2011, 2:12 PM EDT) -- The Financial Industry Regulatory Authority on Monday ordered a Citigroup Inc. unit to pay three investors more than $54 million for its mismanagement of poorly performing municipal bond hedge funds.

Gerald D. Hosier, Brush Creek Capital LLC and Jerry Murdock Jr. filed the claim in June 2009, alleging Citigroup Global Markets breached its fiduciary duty and FINRA rules in its promotion of the funds, which were eventually revealed to be riskier than advertised.

Those funds — including MAT Two LLC, MAT Three LLC and MAT Five...
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