General - Monday, October 12, 2009 17:37 - 2 Comments

Citigroup, Inc. C Slapped with $600,000 Claim

Citigroup, Inc. (C) now America’s number three bank, was assessed $600,000 to settle regulator’s claims concerning supervision of transactions.  Regulators claim that Citibank did not adequately supervise certain transaction that allowed international customers to avoid taxes on stock dividends.

The Financial Industry Regulatory Authority found that Citigroup failed in its duty to supervise the trades and swaps between 2002 and 2005.

“Citigroup’s inadequate supervision resulted in improper trading,” Finra enforcement chief Susan Merrill said in the statement. “Increasingly complex trading strategies must be governed by supervision that is equally sophisticated.”

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Reading almost like a mystery novel, the U.S. Senate also weighed in with an inquiry concerning Wall Street.  The inquiry alleged that certain firms were involved in manipulating derivatives and stock-loans to give clients a way to avoid hundreds of millions of dollars in taxes.

Citgroup “stepped up’ providing the IRS with full disclosure (concerning these allegations) and paid $24 million for the years of 2003 – 2006, said the Senate’s Permanent Subcommittee on Investigations.

“We are pleased to have this matter resolved,” company spokeswoman Danielle Romero-Apsilos said in an e-mailed statement.

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