{"id":42039,"date":"2025-05-08T14:52:00","date_gmt":"2025-05-08T19:52:00","guid":{"rendered":"https:\/\/ustower.net\/?p=42039"},"modified":"2025-05-08T22:56:54","modified_gmt":"2025-05-09T03:56:54","slug":"citigroup-must-face-1-billion-lawsuit-claiming-it-aided-mexican-oil-company-fraud","status":"publish","type":"post","link":"https:\/\/ustower.net\/?p=42039","title":{"rendered":"Citigroup must face $1 billion lawsuit claiming it aided Mexican oil company fraud"},"content":{"rendered":"\n<p class=\"has-medium-font-size wp-block-paragraph\">May 8 (Reuters) &#8211; Citigroup&nbsp;<a href=\"https:\/\/www.reuters.com\/markets\/companies\/C.N\"><u>(C.N), opens new tab<\/u><\/a>&nbsp;must face a revived lawsuit claiming it caused more than $1 billion of losses by orchestrating and concealing a vast fraud at the now-bankrupt Mexican oil and gas services company Oceanografia, a U.S. appeals court ruled on Thursday.<\/p>\n\n\n\n<p class=\"has-medium-font-size wp-block-paragraph\">A three-judge panel of the 11th U.S. Circuit Court of Appeals in Miami said 30 Oceanografia vendors, creditors and bondholders adequately alleged that Citigroup substantially aided the fraud, and a lower court judge erred in dismissing the nine-year-old case.<\/p>\n\n\n\n<p class=\"has-medium-font-size wp-block-paragraph\">Danielle Romero-Apsilos, a Citigroup spokeswoman, declined to comment. Juan Morillo, one of the plaintiffs&#8217; lawyers, said his clients were gratified by the decision.<\/p>\n\n\n\n<p class=\"has-medium-font-size wp-block-paragraph\">Citigroup&#8217;s Banamex unit had provided cash advances to Oceanografia, which provided drilling services to Mexico&#8217;s state-owned oil company Petroleos Mexicanos (Pemex) (PEMX.UL), and collected interest payments on the advances.<\/p>\n\n\n\n<p class=\"has-medium-font-size wp-block-paragraph\">The plaintiffs, including shipping and leasing companies, investment funds and Netherlands-based Rabobank, said Citigroup advanced $3.3 billion to Oceanografia between 2008 and 2014 despite knowing the company had too much debt and had been forging Pemex signatures on authorization forms.<\/p>\n\n\n\n<p class=\"has-medium-font-size wp-block-paragraph\">Citigroup later found nearly $430 million of fraudulent cash advances, and was&nbsp;<a href=\"https:\/\/www.reuters.com\/sustainability\/citigroup-must-face-1-billion-lawsuit-claiming-it-aided-mexican-oil-company-2025-05-08\/SEC were investigating the cash-advance scheme, and in 2018, the latter fined Citigroup $4.75 million for failing to maintain a system of internal controls related to Banamex\"><u>fined, opens new tab<\/u><\/a>&nbsp;$4.75 million by the U.S. Securities and Exchange Commission in 2018 over Banamex&#8217;s internal controls.<\/p>\n\n\n\n<p class=\"has-medium-font-size wp-block-paragraph\">Former Citigroup Chief Executive Michael Corbat said the bank fired 12 employees, and Mexican regulators said 10 bank employees were criminally liable under Mexican law.<\/p>\n\n\n\n<p class=\"has-medium-font-size wp-block-paragraph\">In an 82-page decision, Circuit Judge Britt Grant found sufficient allegations that Citigroup withheld key information about Oceanografia from the plaintiffs, with the interest payments providing a financial incentive.<\/p>\n\n\n\n<p class=\"has-medium-font-size wp-block-paragraph\">&#8220;Citigroup is one of the world&#8217;s most sophisticated financial institutions, and it strains credulity to conclude that, assuming the plaintiffs&#8217; allegations are true, Citigroup lacked awareness of (Oceanografia&#8217;s) activities,&#8221; she added.<\/p>\n\n\n\n<p class=\"has-medium-font-size wp-block-paragraph\"><a href=\"https:\/\/www.reuters.com\/sustainability\/citigroup-must-face-1-billion-lawsuit-claiming-it-aided-mexican-oil-company-2025-05-08\/\">reuters<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>May 8 (Reuters) &#8211; Citigroup&nbsp;(C.N), opens new tab&nbsp;must face a revived lawsuit claiming it caused more than $1 billion of losses by orchestrating and concealing a vast fraud at the now-bankrupt Mexican oil and gas services company Oceanografia, a U.S. appeals court ruled on Thursday. A three-judge panel of the 11th U.S. Circuit Court of [&hellip;]<\/p>\n","protected":false},"author":6,"featured_media":42040,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1155],"tags":[26011,1716,1691],"class_list":["post-42039","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business","tag-citigroup","tag-face","tag-must"],"_links":{"self":[{"href":"https:\/\/ustower.net\/index.php?rest_route=\/wp\/v2\/posts\/42039","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/ustower.net\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/ustower.net\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/ustower.net\/index.php?rest_route=\/wp\/v2\/users\/6"}],"replies":[{"embeddable":true,"href":"https:\/\/ustower.net\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=42039"}],"version-history":[{"count":2,"href":"https:\/\/ustower.net\/index.php?rest_route=\/wp\/v2\/posts\/42039\/revisions"}],"predecessor-version":[{"id":42042,"href":"https:\/\/ustower.net\/index.php?rest_route=\/wp\/v2\/posts\/42039\/revisions\/42042"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/ustower.net\/index.php?rest_route=\/wp\/v2\/media\/42040"}],"wp:attachment":[{"href":"https:\/\/ustower.net\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=42039"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/ustower.net\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=42039"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/ustower.net\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=42039"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}