So the fallout from the meltdown continues with reports that Norwegian municipalities and a bankrupt securities broker, Terra Securities, are suing Citigroup for $200 million after losing all their money in investments in notes which they claim Citigroup said was conservatively geared.
The fascinating part about this story is that it's an indictment of greed shared by the world's biggest bank and the investors. Terra Securities marketed the Citigroup products to towns. But according to reports at the time, all details of the risk were somehow omitted from the Norwegian version of the prospectus put out by Terra. These warnings were included in the original Citigroup prospectus.
Furthermore, the municipalities betrayed the public by borrowing heavily to invest in these complicated schemes.
In the end, they all got greedy. As a result, they all got badly burnt. Now it's ended up in court with them all blaming each other.
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