By Paulina Duran
SYDNEY, Aug 18 (Reuters) - Australian prosecutors dropped criminal charges against the former local head of Citigroup Inc and narrowed their case against the bank and other finance companies and executives for allegedly colluding on a 2015 share sale, a court heard on Wednesday.
Prosecutors told a Federal Court hearing they had dropped charges arising from two out of three "arrangements" allegedly made between Citi and other banks to collude as a cartel during the Australia and New Zealand Banking Group stock issue.
The Commonwealth Director of Public Prosecutions had dropped charges for cartel behaviour against Stephen Roberts, who headed Citigroup in Australia at the time of the 2015 raising, and the case against the remaining eight accused had been "narrowed", judge Michael Wigney said.
The 42 charges contained in the previous indictment had been reduced to 26, with the trial expected to start in April and take no less than four to six months, he noted. The new indictment and charges may still be challenged, the court heard.
"The past several years have been extremely difficult for me and my family, and I am now looking forward to putting this behind me," Roberts said in an emailed statement.
"I am obviously pleased that the CDPP has dropped all charges against me."
The high-profile case, also against Deutsche Bank , ANZ, and five other executives, has been closely watched by financial markets participants because it could influence how capital raisings are conducted.
The new charges were submitted with the court on Monday after prosecutors were ordered in July to refile, for a second time, a "deficient" indictment as they had not identified "sufficiently ... the essential factual ingredients of the alleged offences", court documents show.
Prosecutors allege the accused colluded to withhold unwanted shares and prevent a price decline. All of the accused have denied any wrongdoing. (Reporting by Paulina Duran in Sydney; Editing by Stephen Coates)