After an eight-day trial in Manhattan, US District Judge Louis Stanton granted an injunction and prevented Abbar from arbitrating the case before the Financial Industry Regulatory Authority (FINRA), as reported by Reuters.
In its complaint to the US market regulatory agency, the Saudi businessman accused the US bank for mishandling his family’s investments and claimed for the compensation.
Abbar and his father, Abdullah Mahmoud Abbar, said that after their private banker moved from Deutsche Bank to Citigroup in late 2005, a complex investment transaction was carried through the bank.
Around $343m was invested by Abbars into a structure created by Citigroup, which collapsed and resulted in $383m losses due to the 2008 financial crisis, the Abbars said.
In his decision, Stanton was quoted by Bloomberg as saying, "The entity in which the investor has his account, and from whom the investor purchases his desired product, defines the legal and business locus of his status as a customer, and is the core of the relationship as a customer."
The latest judgement passed by the court will also enable FINRA to scrutinize facts and figures on which a customer files an arbitration case before it.
