Norway's central bank has sued Citigroup for allegedly providing false financial statements which led to losses of more than 700 million dollars, a Citi official said Friday. Norges Bank has complained that Citigroup repeatedly issued "untrue statements and non-disclosure of material information to investors" which led the bank to purchase Citi securities at inflated prices between 2007 and 2009.
"Norges Bank lost in excess of 735 million dollars on its investments in Citigroup common shares and in excess of 100 million dollars on its investments in bonds and preferred shares," said the lawsuit, filed in a Manhattan federal court on September 17. "When the market slowly learned the truth of Citi's financial condition, Citi came close to insolvency, and plaintiff lost a substantial amount of its investment," it said.
A Citigroup official said: "we believe the suit has no merit and we will defend ourselves vigorously." Citigroup, once the world's largest bank, also faces a lawsuit filed in August last year by seven Norwegian towns and an investment house that had lost millions in debt obligations sold by Citigroup.
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