In the Complaint, the SEC stated: "This is a case in which the Defendant misled tens of thousands of its customers regarding the fundamental nature and increasing risks associated with auction rate securities ('ARS') that Citi underwrote, marketed and sold. Through its financial advisers ('FAs'), sales personnel, and marketing materials, Citi misrepresented to customers that ARS were safe, highly liquid investments comparable to money market instruments. As a result, numerous customers invested in ARS funds they needed to have available on a short-term basis." In particular, the SEC alleged that: "During the fall of 2007, the credit crisis and deteriorating market conditions caused Citi to have to support its auctions to a greater extent. Citi knew the ARS market was deteriorating and Citi's inventory of ARS was significantly increasing. Accordingly, Citi knew the risk of failed auctions had materially increased. Citi knew these material facts but did not disclose to its customers timely, complete, and accurate information about them."

The SEC stated that: "[It] finalized settlements with Citigroup Global Markets, Inc. (Citi) and UBS Securities LLC and UBS Financial Services, Inc. (UBS) that will provide nearly $30 billion to tens of thousands of customers who invested in auction rate securities before the market for those securities froze in February."

On December 22, 2008, Federal District Judge Deborah A. Batts entered final judgment against Citigroup Global Markets Inc. pursuant to Citigroup Global Markets Inc's consent.

On June 30, 2010, the SEC published a litigation release regarding this matter. The SEC announced that: "three financial firms that settled the Commission's auction rate securities (ARS) charges against them have satisfied their obligations under their respective settlements and that more than $26 billion has been returned to their ARS customers."