People walk by a CitiBank location in Manhattan on March 01, 2024 in New York City.
Spencer Platt | Getty Images
LONDON — British regulators on Wednesday dished out a combined £61.6 million ($79 million) in fines to U.S. investment bank Citi for failings in its trading systems and controls.
The fines were issued 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 qualified for a 30% reduction in the amount of the penalty after agreeing to resolve the matter.
“Firms involved in trading must have effective controls in place in order to manage the risks involved. CGML [Citigroup Global Markets Limited] failed to meet the standards we expect in this area, resulting in today’s fine,” Sam Woods, deputy governor for prudential regulation and the chief executive officer of the PRA, said in a statement Wednesday.
The regulators said that certain system and control issues persisted during the probe period and led to trading incidents, such as so-called fat-finger trading blunders. The main incident highlighted took place on May 2. 2022, when an experienced trader incorrectly inputted an order, which resulted in $1.4 billion “inadvertently being executed on European exchanges.”
“Deficiencies in CGML’s trading controls contributed to this incident, in particular the absence of certain preventative hard blocks and the inappropriate calibration of other controls,” the statement read.
In a statement to CNBC, a Citi spokesperson said that the bank was pleased to resolve the matter from more than two years ago, “which arose from an individual error that was identified and corrected within minutes.”
“We immediately took steps to strengthen our systems and controls, and remain committed to ensuring full regulatory compliance.” the spokesperson said.
Jessica Roberts is a seasoned business writer who deciphers the intricacies of the corporate world. With a focus on finance and entrepreneurship, she provides readers with valuable insights into market trends, startup innovations, and economic developments.
