Ex-Citigroup banker's fraud case goes to the jury

NEW YORK (Reuters) - A jury was asked on Monday to decide whether one of the few individuals charged over the collapse of subprime mortgage investments intentionally misled investors in a $1 billion Citigroup Inc deal or had been singled out to take the blame for losses.

Brian Stoker, a former manager on Citigroup's mortgage investments desk, could be barred from the financial industry and ordered to pay fines if convicted on two civil counts of securities fraud. His trial in U.S. District Court in Manhattan began two weeks ago.

The U.S. Securities and Exchange Commission contends that Stoker failed to tell buyers that the bank selected some of the assets for a mortgage pool known as a collateralized debt obligation and made a $500 million "short" bet that it would fail.

The transaction caused more than $700 million in investor losses, the SEC said.

In closing arguments, SEC lawyer Jeffrey Infelise told the jury that Stoker's conduct was more than a risky high-stakes bet as the defense has argued.

"Citigroup stacked the deck and Brian Stoker dealt the cards," Infelise said. "Even if you don't believe it was intentional, it had to be negligent."

Infelise also said emails from Citigroup managers introduced at trial showed the bank wanted to identify assets it could bet against. "We are trying to find the worst performing assets," one of the emails said.

Stoker, of Pound Ridge, New York, was the only person charged in a broader case against Citigroup by the regulator. Last week, he took the stand in his own defense, testifying that he followed best practices by keeping lists of assets and urging his team to review them before marketing to potential investors.

In November 2011, U.S. District Judge Jed Rakoff, who is overseeing the trial, rejected a $285 million settlement between Citigroup and the SEC over allegations surrounding the investment pool. The judge said that failure to require the bank to admit or deny the charges left him no way to know whether the pact was fair. A federal appeals court in New York is expected to consider later this year whether that rejection was proper.

In his closing statement Monday, Stoker's lawyer, John Keker, described his client as a "straight arrow."

Keker told the jury that "most of the trial had nothing to do with Brian Stoker" and that it reminded him of the children's book, "Where's Waldo?"

Some jurors giggled when Keker displayed a reproduction of the cover of a Waldo book. In the books, the reader tries to find the Waldo character in a crowd of other characters.

"Everyone in this CDO group, including the managing directors, knew as much or more than Brian Stoker did," Keker said.

The case is SEC v. Stoker, U.S. District Court, Southern District of New York, No. 11-cv-7387.

(Reporting By Grant McCool; Editing by Martha Graybow and Richard Chang)

Source: http://news.yahoo.com/ex-citigroup-bankers-fraud-case-goes-jury-185459306--sector.html

daytona jeff gordon artie lange nascar daytona 2012 kasey kahne angelina jolie right leg saving face