In a sharply worded opinion, a three-judge panel of the Second Circuit U.S. Court of Appeals stayed the Securities and Exchange Commission's case against Citigroup.

In a sharply worded opinion, a three-judge panel of the Second Circuit U.S. Court of Appeals stayed the Securities and Exchange Commission's case against Citigroup on the grounds that the bank and the agency have a good chance of overturning U.S. Senior District Judge Jed Rakoff's February rejection of their $285-million proposed no-fault settlement. Rebuking Rakoff, the panel affirmed the SEC's argument that the former had no business assessing the public interest in the case.

Judge Rakoff last November rejected the SEC's settlement with Citigroup. Citigroup had allegedly created a misleading fund in which the investors lost more than $700 million while Citigroup earned $160 million. Rakoff stated that the deal

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Riley Guerin

Daily Journal Staff Writer
rguerin@journaltech.com

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