This excerpt taken from the C 8-K filed Oct 13, 2009.
Freddie Mac. Citigroup Global Markets Inc., along with a number of other financial institutions, has been named as a defendant in two lawsuits pending in the United States District Court for the Southern District of New York brought by Freddie Mac shareholders who purchased preferred shares traceable to a November 2007 offering of Z Preferred Shares. Plaintiffs allege violations of Section 12(a)(2) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 because the offering materials failed to disclose
Freddie Macs exposure to mortgage-related losses, poor underwriting procedures and risk management, and the resulting negative impact to Freddies capital.