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08.10.2020

Citi to pay a fine over risk-management issues

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The bank must overhaul its risk management, data governance and internal controls

Stocks impacted: Citigroup Inc (C)

As U.S. banking regulators reported, Citigroup Inc has agreed to pay a $400 million penalty for failing to address "several longstanding deficiencies" across the company. The bank must overhaul its risk management, data governance and internal controls, according to the authorities. The order from the Office of the Comptroller of the Currency gives the regulator the ability to veto any significant new acquisitions by the bank. Earlier this week, the company fired a manager in its technology division after he was identified as the operator of a popular website promoting the QAnon conspiracy theory. The bank is facing numerous issues apart from recent developments regarding faults in the company’s risk management systems. At the end of September, Citigroup agreed to pay $4.5 million in fine to a U.S. regulator for losing millions of audio files. Performance of Citigroup has been also affected by the pandemic, and its CFO recently commented on disappointing revenue performance in third-quarter 2020. Over this period, shares of the company depreciated 15.6%. On Wednesday, Citigroup stocks finished 1% higher amid a broad-based rally on Wall Street.

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