Risk management deficiencies seem to be a recurring problem for Citigroup
After at the end of September, the international banking sector was shaken by a $2 trillion illicit money transactions scandal, now, Citigroup – a major American bank – got fined by the Federal banking regulators.
The Federal Reserve and the Office of the Comptroller of the Currency (#OCC) announced that they would fine Citigroup $400 million for risk management deficiencies and data governance and internal controls across the company. The two institutions cited "serious and longstanding deficiencies and unsafe or unsound practices."
According to the Federal Reserve Board's notes, the fine comes after Citigroup failed to address the concerns related to risk management and internal controls that have been identified in 2013 and 2015.
Citi's board must now submit a plan to explain how to supervise the necessary improvements and how the senior management will implement the changes alongside a dedicated team. Per the order, the #bank must improve its compliance #risk #management program and quality management practices.
Citi wasn't late to address the situation and stated that it is "fully committed" to make the changes. It plans to invest over $1 billion in its efforts to comply with the regulators' requirements.
It is not the first time when Citigroup gets a fine for unfair practices. The US Commodity Futures Trading Commission fined the bank with $4.5 million for deleting 2.77 million audio files that have been subpoenaed as evidence, which Citi promised to preserve.
Despite the news, Citigroup's stock price closed 0.97% higher.
Read here about the $2 trillion scandal!
Sources: edition.cnn.com, reuters.com, finance.yahoo.com
This information is prepared for general circulation. It does not regard to the specific investment objectives, financial situation or the particular needs of any recipient.
You should independently evaluate each financial product and consider the suitability of such a financial product, by taking into account your specific investment objectives, financial situation or particular needs, and by consulting an independent financial adviser as needed, before dealing in any financial products mentioned in this document.
This information may not be published, circulated, reproduced or distributed in whole or in part to any other person without the Company’s prior written consent. Past performance is not always indicative of likely or future performance. Any views or opinions presented are solely those of the author and do not necessarily represent those of za.capex.com
JME Financial Services (Pty) Ltd trading as ZA.CAPEX.COM acts as intermediary between the investor and Magnasale Trading Ltd, the counterparty to the contract for difference purchased by the Investor via ZA.CAPEX.COM, authorised & regulated by the Cyprus Securities and Exchange Commission with license number 264/15. Magnasale Trading Ltd is the principal to the CFD purchased by investors.