Boston, MA 09/03/2014 (wallstreetpr) – The diversified financial services provider Citigroup Inc (NYSE:C) has been advised to face a hearing by the U.S. judge on a subpoena of a hedge fund seeking proof of Argentina threat. The judge was also overseeing the issue of defaulted bondholders and Argentina.
Hedge Fund Asks For Proof
NML Capital, a hedge fund company, had demanded Citigroup Inc (NYSE:C) to provide proof of claims that Argentina had threatened the bank with punitive actions in case the bank maintains to abide by Thomas Griesa, a U.S. District Judge in Manhattan, order, Bloomberg reported.
Billionaire Paul Singer controlled NML Capital was a defaulted debtholder and extended its bid for information. The hedge fund company disclosed that the information was critical and time-sensitive since the Griesa is scheduled to hear the case on September 10. It also sought to justify its position by charging Citibank that it failed to provide any evidence of threats by Argentina and merely submitted a letter to the appeals court.
NML Capital also pointed out that the Manhattan judge’s intervention was needed to force the bank to comply apart from allowing the hedge fund to completely probe the Argentina threats illustrated by the Citigroup Inc (NYSE:C). Therefore, it had sought a court order to force the bank to provide proof of Argentina threat.
Citibank Argument
Citigroup Inc (NYSE:C) had put forth its argument before the judge saying that it might lose its Argentina branch in case the U.S. appeals court failed to give its permission to allocate money for restructured bondholders of Argentina. Interestingly, Judge Thomas Griesa had barred the financial services provider from proceeding unless it pays defaulted debtholders too.
Citigroup had also argued before the Court of Appeals in New York that it would be subjected to ‘grave sanctions’ and put themselves in a ‘dangerous position’ if it continues to comply with Griesa order. Citigroup Inc (NYSE:C) had pointed out the potential imprisonment of its executives apart from expulsion of its business on account of Griesa order.
