WASHINGTON (CN) – Citigroup will pay $285 million to settle SEC charges it misled investors about collateralized debt obligations tied to the U.S. housing market, the SEC said this morning. “The CDO defaulted within months, leaving investors with losses while Citigroup made $160 million in fees and trading profits,” the SEC said.
In one of the most notorious tricks used in the financial meltdown, Citigroup’s principal U.S. broker dealer, Citigroup Global Markets, helped select the $500 million in assets for a CDO portfolio, then bet against it, taking a proprietary short position, without disclosing to investors that it was betting against the very assets it was pushing, the SEC said.
In a bit of self-promotion, the SEC today also issued two colorful charts showing how much money it has recovered from bad actors in the financial crisis.
One chart claims the SEC has recovered $1.97 billion from 81 companies and humans, including 39 CEOs, CFOs and other senior officers.
The other chart tots up the penalties and recoveries from 13 giant institutions, led by Goldman Sachs ($550 million), followed by State Street ($300 million), Citigroup ($285 million), J.P. Morgan Securities ($209.6 million), and Bank of America ($150 million).
The SEC did not say whether it has helped send any bad guys to jail.