Citigroup unit to pay $8.3M in FINRA partial tender offer case

A broker-dealer affiliate of Citi agreed to pay nearly $8.3 million as part of a settlement with the Financial Industry Regulatory Authority (FINRA) addressing allegations the firm overtendered shares in partial tender offers (PTOs) and received millions in ill-gotten gains.

Citigroup Global Markets was fined $2.5 million and must disgorge approximately $5.8 million in accordance with FINRA’s decision notice published Tuesday. Nearly $2.8 million of the totals will be paid to FINRA, while the remainder will be split evenly between stock exchanges NYSE American and NYSE Arca.

FINRA, a self-regulatory organization, determined not to impose prejudgment interest in the case because the fine and disgorgement together achieved the appropriate deterrence value of equitable disgorgement, it said.