[Photo: Edward Lich / Pixabay]

In 2008, Citigroup won an arbitration case in which a client, Move, Inc., claimed the bank mismanaged its $131 million investment in auction-rate securities dating back to the financial crisis. Move – a real estate website operator now owned by Rupert Murdoch’s News Corp. - may get a new chance to present its claim once again because, as it turns out, the chairman of that arbitration panel was an impostor.

Move said it learned in March 2014 from an article in the legal press that the arbitrator had lied about being a licensed attorney.

“It is now undisputed that Mr. Frank, who is ‘James Hamilton Hardy Frank,’ was impersonating retired California attorney ‘James Hamilton Frank’,” an appeals court said. “FINRA later confirmed that Mr. Frank lied about his qualifications in his ADR and subsequently removed him from all cases and from its roster.”

A federal appeals court said Friday it wasn’t fair that the chairman of the FINRA panel that ruled in favor of the bank in a case brought by Move Inc. was posing as a retired California attorney working as an arbitrator. “Move’s right to a fundamentally fair hearing was prejudiced by the fraudulent misrepresentations of the arbitration panel’s chairperson, resulting in proceedings led by an arbitrator who should have been disqualified from the dispute under the rules and regulations of [FINRA]," the U.S. Court of Appeals in San Francisco ruled.

A lower court had refused in 2014 to vacate the arbitration judgment - even when presented with evidence of the impersonation - saying Move had missed the 3-month deadline to contest it.

The case is Move Inc. v. Citigroup Global Markets Inc., 14-56650, U.S. Court of Appeals for Ninth Circuit (San Francisco).