Citigroup to pay $15 million for misleading retirement pitch — Business Management Daily: Free Reports on Human Resources, Employment Law, Office Management, Office Communication, Office Technology and Small Business Tax Business Management Daily

Citigroup to pay $15 million for misleading retirement pitch

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The National Association of Securities Dealers (NASD) fined Citigroup Global Markets Inc. $3 million to settle charges of using misleading sales materials during retirement seminars for BellSouth employees in North Carolina and South Carolina. NASD also ordered Citigroup to pay $12.2 million in restitution, and it suspended three brokers who conducted the seminars.
    The brokers, based in Charlotte, convinced former BellSouth employees to dump their pensions and 401(k) accounts to invest in stock funds instead, promising 12% returns. Many employees were led to believe they could retire early.
    Instead, the more than 200 BellSouth employees saw the principal in their accounts decline by $12.2 million. NASD found that Citigroup failed to supervise the brokers adequately, having never reviewed the sales materials they were using in the seminars.

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