Finance
Citi has been fined $79 million by British regulators for fat-finger trading and audit failures
People walk past a CitiBank location in Manhattan on March 1, 2024 in New York City.
Spencer Platt | Getty Images
LONDON – British regulators on Wednesday handed out a total of £61.6 million ($79 million) in fines to US investment bank Citi over deficiencies in its trading systems and controls.
The fines were imposed by the Prudential Regulation Authority and the Financial Conduct Authority, whose investigation focused on the period between April 1, 2018 and May 31, 2022. Citi was eligible for a 30% reduction in the fine amount after agreeing to the solving the problems. the matter.
“Companies involved in trading must have effective controls in place to manage risks. CGML [Citigroup Global Markets Limited] have not met the standards we expect in this area, which has resulted in today’s fine,” said Sam Woods, Deputy Governor for Prudential Supervision and CEO of the PRA. said in a statement on Wednesday.
The regulators said certain system and control issues persisted during the investigation period and led to trading incidents, such as so-called ‘fat-finger trading blunders’. The main incident highlighted occurred on May 2, 2022, when an experienced trader entered an order incorrectly, leading to $1.4 billion being “accidentally executed on the European exchanges.”
“Deficiencies in CGML’s trade controls contributed to this incident, particularly the absence of certain preventive hard blocks and the inappropriate calibration of other controls,” the statement said.
In a statement to CNBC, a Citi spokesperson said the bank was pleased to resolve the issue from more than two years ago, “which arose from an individual error that was identified and corrected within minutes.”
“We have taken immediate steps to strengthen our systems and controls and remain committed to ensuring full regulatory compliance.” the spokesperson said.
