Fintoism History of Money AML Fines Citigroup Global Markets Quantitative Easing Emerging Markets Treasury PacWest

Citigroup Global Markets Gets Fined For $13 Million Over Multi-year Financial Misconduct

Another bank gets fined by an overarching watchdog for financial wrongdoings, and water is still wet. The FCA has fined Citigroup Global Markets over $13 million due to trading activity policing failures. It will not be the last time a major bank gets fined, yet they continue their less-than-optimal business practices either way. 

Another FCA Fine

It would appear as if financial watchdogs collect fines from banks virtually every quarter. While there are many day-to-day operations at a bank, not all of them follow the proper guidelines. It is an ongoing problem and one that will not go away with these fines either. Even so, Citigroup Global Markets will have to cough up over $13 million to the UK’s Financial Conduct Authority.

The fine is the result of market abuse regulations being violated. These regulations are designed to prevent insider trading and market manipulation and have been in effect since 2016. All financial firms need to monitor trade across various markets and instruments. However, Citigroup Global Markets failed to implement these measures for nearly two years. In hindsight, a $13 million fine seems rather small for purposefully ignoring requirements designed to protect consumers. 

FCA Executive Director of Enforcement and Market oversight Mark Steward states:

“The framework for market integrity depends on the partnership between the FCA and market participants using data to detect suspicious trading. By not fully implementing the new provisions when required, Citigroup Global Markets did not carry its full weight in this partnership, impacting market integrity and the overall detection of market abuse.”

In addition, the FCA confirmed Citigroup Global Markets earned over $3 billion in revenue from arranging and executing trades. Making things even more interesting is how the initial fine would have been nearly $20 million. Citi managed to cut it down by 30% by agreeing to cooperate in resolving this matter. It is another fine example of how flawed the banking regulation is, including those overseeing the implementation of these rules. Harsher action is the only path forward.