NEW YORK, Nov. 22, 2011 (GLOBE NEWSWIRE) -- A Newark, New Jersey based Financial Industry Regulatory Authority (FINRA) arbitration panel has ordered Citigroup Global Markets, Inc. to pay damages of more than $750,000.00 to a client of Maddox Hargett & Caruso, P.C. in connection with his purchase of the municipal arbitrage fund that was known as MAT Five. The FINRA arbitrators also assessed the entire cost of the hearing against Citigroup.
"Through the issuance of this arbitration award, our client not only received 100% of the losses that he sustained as a result of his investment in MAT Five, but the arbitrators also further held Citigroup liable for statutory interest on his principal loss and assessed all FINRA forum fees that were associated with the arbitration hearing against Citigroup as well," according to Steven B. Caruso of Maddox Hargett & Caruso, P.C., who served as co-counsel for the investor.
"This is an important win for MAT investors," stated Ryan K. Bakhtiari of the Beverly Hills, California firm of Aidikoff, Uhl & Bakhtiari, which served as co-counsel for the investor, "because it sends a clear message to Citigroup that you cannot mislead investors irrespective of their wealth and experience."
"This is now the seventeenth investor household that we have been successful for in the pursuit of their claims involving the Citigroup ASTA-MAT municipal arbitrage product before FINRA arbitration panels," Caruso noted.
Earlier this year, the law firms of Maddox Hargett & Caruso, P.C. and Aidikoff Uhl & Bakhtiari received the largest FINRA arbitration award ever levied against a major Wall Street brokerage firm on behalf of individual investors, in another case against Citigroup Global Markets involving the same ASTA-MAT municipal arbitrage product, when a Denver arbitration panel found the firm liable for $54 million of damages – including $17 million of punitive damages which is believed to be one of the largest punitive damage awards in the history of securities arbitration.
MAT Five was a leveraged municipal arbitrage hedge fund launched by Citigroup Global Markets, Inc. and sold through Smith Barney, part of Citigroup's (NYSE:C) Global Wealth Management Group. MAT Five and the earlier launched MAT funds were marketed exclusively to high net worth clients of the firm between 2002 and 2007. MAT Five was launched in February 2007 and imploded along with the other MAT funds in February 2008 causing catastrophic losses to investors. An identical product known as ASTA was marketed and sold to clients of Citigroup Private Bank.
Maddox Hargett & Caruso, P.C. continues to investigate FINRA arbitration claims on behalf of investors who suffered losses in leveraged municipal arbitrage products including ASTA and MAT.
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