Institutional Customer Braintree Laboratories Sues Citigroup for $33 Million In Auction Rate Securities

Braintree Laboratories has filed federal court litigation alleging that the firm misrepresented the nature of the auction rate securities that it recommended. According to the complaint, Citigroup falsely characterized the securities as "seven day rolls" - liquid, government-backed, "money market" investments that could be sold at par at any time on seven days' notice. In truth, the complaint alleges, "Citigroup knew that the auctions for such securities had failed, making them illiquid." Citigroup declined to comment.

SNSFE continues to investigate auction rate securities claims on behalf of investors.