Citigroup Files Nasdaq Claim Over Facebook Inc (FB) IPO

Citigroup Inc. (NYSE:C) has reportedly filed a claim with NASDAQ OMX Group, Inc. (NASDAQ:NDAQ) in connection with Facebook Inc (NASDAQ:FB)’s botched initial public offering last year.

Citigroup Files Nasdaq Claim Over Facebook Inc (FB) IPO

The Wall Street Journal reports that two people who are aware of the claim said that it was filed on Monday, which was the deadline for filings from firms wishing to take part in the $62 million plan for compensation from the IPO blunder. The sources said even though Citigroup Inc. (NYSE:C) filed the claim, it is still considering all options.

Citigroup Inc. (NYSE:C) is apparently examining its potential to recover losses through the compensation plan approved by regulators earlier this year. That plan called for a total of $62 million to cover all claims in connection with Facebook Inc (NASDAQ:FB)’s botched IPO. Firms filing claims under the plans must indicate how much they believe they lost because of the problematic IPO last May.

They may still pursue outside cases against NASDAQ OMX Group, Inc. (NASDAQ:NDAQ). However, if they decide to accept payment under the plan for part of the losses they incurred, then they waive their right to file other lawsuits against NASDAQ OMX.

Citigroup’s market-making division lost $20 million in the IPO, although that is just a small fraction of the more than $500 that was lost by the largest securities firms on Wall Street because of the huge mistake. According to Reuters, UBS AG (NYSE:UBS) said it alone lost more than $350 million in the IPO error. It said last month that it filed a demand for arbitration against NASDAQ OMX Group, Inc. (NASDAQ:NDAQ) in connection with Facebook Inc (NASDAQ:FB)’s IPO.

Firms and investors have been extremely critical of the low $62 million compensation plan approved by regulators, saying that NASDAQ OMX should be liable for all of the hundreds of millions in losses that were incurred as a result of the troublesome IPO.




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Michelle Jones
Michelle Jones was a television news producer for eight years. She produced the morning news programs for the NBC affiliates in Evansville, Indiana and Huntsville, Alabama and spent a short time at the CBS affiliate in Huntsville. She has experience as a writer and public relations expert for a wide variety of businesses. Michelle has been with ValueWalk since 2012 and is now our editor-in-chief. Email her at Mjones@valuewalk.com.