Securities Investigation: Citigroup’s Structured Notes

Investor Lawsuits: Citigroup’s Autocallable Contingent Coupon Equity Linked to the Worst Performing of Apple Inc., NIKE, Inc., The Walt Disney Company  

The White Law Group is investigating potential securities fraud claims involving Citigroup Autocallable Contingent Coupon Equity Linked Securities Linked to the Worst Performing of Apple Inc., NIKE, Inc. and The Walt Disney Company and the liability broker dealers may have for unsuitably recommending it to investors.  
 
Sponsored by Citigroup Global Markets, the Autocallable Contingent Coupon Equity Linked Securities Linked to the Worst Performing of Apple Inc., NIKE, Inc. and The Walt Disney Company Due October 12, 2023, is a structured note investment product. According to its prospectus, Citigroup Autocallable Contingent Coupon Equity Linked Securities are highly risky, complex investments. It is possible you could lose some or all of your investment.  

These structured notes are reportedly linked to the common stock of Apple, Inc. Nike Inc and the Walt Disney Company. According to the prospectus just a few of the many risk factors include the following:  

• The securities will not be listed on any securities exchange and you may not be able to sell them prior to maturity.    
• You may lose a significant portion or all of your investment.   
• The securities are subject to heightened risk because they have multiple underlyings.  
• The securities are subject to the risks of each of the underlyings and will be negatively affected if any one underlying performs poorly.    
• You may not be adequately compensated for assuming the downside risk of the worst performing underlying.  

Did your Broker recommend an investment in a Citigroup Structured Note Product? 

Structured notes are securities issued by financial institutions (Citigroup, Citigroup, Morgan Stanley, Deutsche Bank, JP Morgan Chase, RBC, etc.) whose returns are based on, among other things, equity indexes, a single equity security, a basket of securities.  The return on an investment in a structured note is “linked” to the performance of a specific referenced asset or index.  Structured notes have a fixed maturity and include two components – a bond component and an embedded derivative.  Financial institutions typically design and issue structured notes, and broker-dealers, often for a large commission, sell them to individual investors.  

The White Law Group is investigating the liability that brokerage firms may have for recommending complex, often extremely high-risk, structured notes to investors.    

With the market in turmoil, many investors purchased these investments believing they provided downside protection or were similar to bonds because of the dividend component, instead finding that these products can suffer enormous losses.  

Brokers often pitch structured products as providing “downside protection” against losses to a related index while allowing modest upside gain potential. However, investors in Structured Note products are finding out that the protection offered is limited and insufficient to ward off enormous losses.  

These products also typically pay a high fee to the financial advisors that sell them. Sometimes these structured products can have misleading names like market linked certificates of deposit (CDs).  

Unfortunately for investors there are literally hundreds of structured products currently being offered by financial institutions, each with their own underlying risk based on whatever they may be linked to. 

To learn more about the risks of investing in Structured note products please see: Structured Note Products Lawsuits – Securities Fraud Attorneys or Are Structured Notes Worth the Risk? 

Keep in mind — brokerage firms are required to perform adequate due diligence on any product they recommend. They are also required to ensure that all recommendations made are suitable for their client in light of the client’s age, investment experience, net worth, income, and investment objectives.  

If a brokerage firm fails to do either of these things, the firm can be held responsible in a FINRA arbitration claim.  

How to Recover Investment Losses through FINRA Arbitration 

If you have suffered losses investing in Citigroup’s Autocallable Contingent Coupon Equity Linked Securities Linked to the Worst Performing of Apple Inc., NIKE, Inc. and The Walt Disney Company you may be able to recover your losses through FINRA arbitration.   

FINRA operates the largest securities dispute resolution forum in the United States, and has extensive experience in providing a fair, efficient and effective venue to handle a securities-related dispute. Arbitration and mediation are two non-judicial ways to resolve problems and disputes.   

For a free consultation with a national securities attorney, please call the White Law Group at 888-637-5510. For more information on The White Law Group, visit https://whitesecuritieslaw.com.  

See also: Securities Investigation: Citigroup Autocallable Contingent Coupon Equity Linked to Worst Performing of Alphabet Inc., Amazon.com  

The White Law Group, LLC is a national securities fraud, securities arbitration, investor protection, and securities regulation/compliance law firm with offices in Chicago, Illinois and Seattle, Washington.