Lawsuit

Citi sues Hong Kong hedge fund manager for gold loss

Citi’s Singapore unit has sued Hong Kong-based hedge fund manager Raghavendran Rajaraman over a USD1million shortfall incurred after it liquidated his gold account reported FINalternatives. According to Citi, Rajaraman used a USD20million credit line to finance his gold investments. The precious metal slumped by almost USD100 per ounce on 26 September and according to Citi: “The margin level under the account deteriorated to the ‘forced sell’ level deemed by the bank.” The bank sold more than half the gold and the rest under a stop-loss order along with another USD1.7million in gold held as collateral. However, even after the sale Citi was left with a loss of USD1.03million, which it is seeking to recover plus interest. Rajaraman, who works with but not for 3 Degrees Asset Management, hasn’t filed his defense. “We intend to pursue the case and it’s inappropriate for us to comment further,” Adam Abdur Rahman, Citigroup’s Singapore-based spokesperson, was quoted as saying.

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