Robert Armstrong in New York October 8 2020
US bank regulators have fined Citigroup $400m for failing to correct “longstanding deficiencies” in its risk and control systems, and ordered the lender to upgrade its processes and its technology.
The fine comes on the heels of news that, in August, Citi mistakenly wired $900m to creditors of one of its clients, Revlon, sparking a protracted legal fight. Last month, the bank announced Mike Corbat would retire as chief executive in 2021, several years earlier than expected.
In a consent order agreed to by the bank, the Federal Reserve found that Citi “has not taken prompt and effective actions to correct practices previously identified [in] compliance risk management, data quality management, and internal controls”. The Fed ordered Citi to submit a remediation plan within four months.
In conjunction with the Fed’s action, the Office of the Comptroller of the Currency issued a similar order and levied a $400m fine against the bank. The OCC demanded corrective actions including “the thorough redesign of data architecture, re-engineering of processes, and modernisation of system applications and information technology infrastructure”