US authorities fined Citibank US$400 million over deficiencies in risk management practices and required an overhaul of internal controls at the global financial powerhouse, officials announced on Wednesday.
The US Treasury’s Office of the Comptroller of the Currency (OCC) issued the fine, in parallel with a related action from the US Federal Reserve, citing failings at the bank.
The Fed said that the crackdown reflected that Citi had “not taken prompt and effective actions to correct practices previously identified by the board in the area of compliance risk management, data quality management and internal controls.”
The Fed said that the issues date back to 2013, but had not been adequately addressed.
Under the settlement with the OCC, Citi promised to appoint a compliance committee that would provide quarterly updates to the company’s board on actions to improve compliance.
Citi said it was committed to righting its standing with regulators and would commit US$1 billion in risk management-related programs this year.
“We are disappointed that we have fallen short of our regulators’ expectations, and we are fully committed to thoroughly addressing the issues identified in the consent orders,” the bank said.
The settlement with the OCC came about a month after Citi appointed Jane Fraser to succeed Michael Corbat as chief executive in February next year.
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