CITIGROUP PAYS $400M US FINE FOR PERSISTENT LAPSES
Citigroup, Inc. has agreed to pay a $400 million fine and draw up a sweeping plan to fix persistent risk management and operational problems that have led to multiple violations and penalties over the years, US regulators said, Pete Schroeder and David Henry reported for Reuters.
The Federal Reserve and Office of the Comptroller of the Currency (OCC) said the country’s third-largest bank had for years failed to address the issues despite repeated warnings. It must take “comprehensive” action to overhaul its risk management, data governance, internal controls and some compensation practices, the regulators said in separate orders and statements.
The orders, which could curtail Citi's ability to make acquisitions and personnel decisions, intensify challenges facing incoming Chief Executive Jane Fraser, who also needs to revive the bank's lagging revenues and tarnished brand, Reuters has reported.
Citi’s risk management was not “commensurate with the Bank’s size, complexity, and risk profile,” the OCC said. Citi responded in a statement that it was disappointed to have fallen short of regulatory expectations and had “significant remediation projects” under way. It said it had “accelerated investments and made structural changes,” citing over $1 billion in spending this year to address the problems.