“Citigroup” Were Fined ฿347 M. in Penalties of Lax Loan Detection in Mexico
Citigroup’s lax supervision and weak internal controls led to its failure in detecting load fraud.
Citigroup Inc. were fined 10.5 million USD or about 347 million baht and agreed to pay the price in penalties to settle two enforcement actions involving its books and records, internal accounting controls, and trader supervision, according to the Securities Exchange Commission.
“Today’s charges reflect the Commission’s view that Citigroup fell short of its obligations to supervise its traders and maintain appropriate controls to guard against fraud. Citigroup’s lax supervision and weak internal accounting controls allowed a handful of rogue traders to mismark positions over several years and, separately, resulted in the unnecessary loss of hundreds of millions of dollars of its shareholders’ assets to fraud.” said SEC director Marc Berger.
About $5.75 million was paid to settle allegations tied to unauthorized trading and another $4.75 million to settle claims that it failed to detect fraudulent loans issued by its Mexican subsidiary, Banamex.
Citigroup settled for the fine without admitting or denying the SEC’s findings.
