Rakoff Reluctant To Bless $285M Citi, SEC Deal

Law360, New York (November 9, 2011, 7:44 PM EST) -- The New York federal judge reviewing Citigroup Inc.'s $285 million proposed settlement with the U.S. Securities and Exchange Commission expressed doubts Wednesday about the agreement, which some observers have said lets Citigroup off too easily for alleged misdeeds over mortgage-related securities.

Though U.S. District Judge Jed Rakoff stopped short of saying he would reject the settlement — which aims to resolve agency claims that Citigroup secretly shorted elements of about $1 billion in collateralized debt obligations it hawked — he seemed reluctant to give his unqualified blessing to the deal.

“The adversary system really doesn't operate well when the court is...

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