An arbitration panel from the Financial Industry Regulation Authority (FINRA) made the ruling after the actor, made famous by his portrayal of villain JR Ewing during the long-running US series, filed the complaint in May 2009.
He claimed that the investment bank had breached contract, fiduciary duty, committed fraud by misrepresentation and violated federal security laws in relation to funds held in various accounts.
The claim was made over âunspecified securitiesâ and a life insurance policy.
Under the terms of the settlement, the financial services provider will pay $10 million to a charity of Mr Hagmanâs choice and a further $1.1 million directly to the star.
An additional $440,000 will be paid to cover legal fees while another $20,000 will be used to fund administrative costs.
A spokesperson for Citi said: âWe are disappointed and disagree with the panel's findings, and we are reviewing our options.â
Mr Hagman first rose to stardom through his portrayal of astronaut Anthony Nelson in US series I Dream of Jeannie.
By Jim Ottewill