Citigroup Settling Enron Claims

Citigroup Settling Enron Claims

March 27, 2008 Filed Under: Oil and Gas  

Citigroup Inc. agreed to pay $1.66 billion to creditors of Enron Corp. who lost money when the energy trader collapsed in 2001.

Citigroup was the last remaining defendant in what was known as the “Mega Claims” lawsuit, filed in 2003 against 11 banks and brokerages. The filer, Enron Creditors Recovery Corp., alleged that with the help of banks like Citigroup, Enron kept creditors in the dark about the company’s financial troubles by using shady accounting.

The settlement — plus previous bank settlements and Enron’s subsequent release of $1.7 billion held in reserves — gives those creditors more than $5 billion, Enron said. That amounts to 37.4 cents on each dollar the creditors had tied up in Enron, according to Enron.

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