As U.S. officials and bank executives scrambled to save the global financial system after Lehman Brothers’s bankruptcy in the fall of 2008, Citigroup Inc. traders were doing what traders always try to do, Bloomberg reported today. "Ringing the register, homey,” Thomas Giardi, a trader in the bank’s credit derivatives trading unit, said in a chat message on Sept. 17, two days after Lehman’s bankruptcy. His gleeful boast — along with at least a dozen from others — came as Citigroup’s top traders were furiously trying to deal with thousands of derivatives terminated by Lehman’s collapse. Contained in chat messages and recordings from that turbulent September week, the exchanges are the most colorful, if not potentially damaging, evidence so far in a civil trial on allegations that Citigroup inflated its $2 billion bankruptcy claim related to those derivatives. At the time of bankruptcy, Lehman Brothers Holdings Inc. and Citigroup had entered into more than 30,000 derivatives trades tied to an estimated $1.18 trillion of wagers on everything from interest rates to corporate and sovereign debt. Lehman’s bankruptcy gave Citigroup the right to determine its damages.
