Citi fined GBP 61.6 million by UK regulators

Thursday 23 May 2024 08:59 CET | News

Citi has been fined GBP 61.6 million by the PRA and FCA UK regulators for control failings in its trading operations from April 2018 to May 2022. 


Following this announcement, both the Prudential Regulation Authority (PRA) and the Financial Conduct Authority (FCA) probed and fined Citigroup over the trading operation failings, which took place from April 2018 to May 2022. The bank was fined GBP 61.6 million (approximately USD 78.5 million). 

In addition, the financial institution’s London unit, Citigroup Global Markets Limited (CGML), had a series of failings that were announced as trading incidents, one of which was a mistaken USD 444 billion order in May 2022. 

Citi has been fined GBP 61.6 million by the PRA and FCA UK regulators for control failings in its trading operations from April 2018 to May 2022.

More information on the announcement

As firms, banks, and companies that are involved in trading need to have effective and secure controls in place in order to manage the potential risks and challenges that are involved in the industry, Citi failed to meet the regulatory requirements and standards that the UK watchdogs expected in this area of the market, which resulted in the financial institution to receive the fine. 

In May 2022, Citi processed the USD 444 billion order that was supposed to amount to just USD 58 million. This process prompted USD 1.4 billion in mistaken sell orders, as the reported cause of the trading error was a merchant mistake. The primary control failure resulted in Citi’s electronic trading system generating several erroneous orders following the mistake. At the same time, the PRA mentioned that the failure coincided with a material short-term movement in several European indices before the overall trade process was cancelled. According to the regulator, the absence of certain preventative hard blocks and the overall inappropriate calibration of other controls were the causes of the mistake.

In addition, Citi received several supervisory communications from the Prudential Regulation Authority in order for it to improve, but its own system had also identified problems with a series of incidents with deficiencies and challenges. The bank is expected to focus on strengthening its systems and controls, while also remaining committed to ensuring full regulatory compliance. 

The PRA fined Citi GBP 33.9 million for failing in its trading systems and controls, a penalty that was reduced by 30% after the financial institution agreed to resolve the issue. In addition, the FCA fined Citi with GBP 27.8 million as well. 

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Keywords: regulation, fraud management, fraud detection, fraud prevention, online fraud
Categories: Fraud & Financial Crime
Companies: Citi, FCA, PRA
Countries: United Kingdom
This article is part of category

Fraud & Financial Crime






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