The many faces and FINES of Citi

A search in Google using the phrase "citi fined" showed 7160 results. with fines coming from many countries. A sample follows. NYT columnist Mr. Friedman notes, in his article, Did You Hear the One About the Bankers? - NYTimes.com: "Our Congress today is a forum for legalized bribery. One consumer group using information from Opensecrets.org calculates that the financial services industry, including real estate, spent $2.3 billion on federal campaign contributions from 1990 to 2010, which was more than the health care, energy, defense, agriculture and transportation industries combined. Why are there 61 members on the House Committee on Financial Services? So many congressmen want to be in a position to sell votes to Wall Street."

The outstanding actions of the bankers, particularly Citi, needs to be "rewarded."

Citi to pay $285 million over SEC charges - MarketWatch: "Citigroup Inc. on Wednesday agreed to pay a $285 million fine to settle civil charges brought by the Securities and Exchange Commission that it sold securities backed by mortgages that it simultaneously bet against.

The regulator alleges that Citigroup Global Markets structured and marketed a $500 million collateralized debt obligation that was backed by subprime loans, and then bet against those mortgage-related assets, which it didn’t disclose to investors."According to the agency, one trader in an email called the portfolio “dogsh!t” and “possibly the best short ever.”

The CDO in question defaulted within months, leaving investors with losses while Citigroup (NYSE:C) made $160 million in fees and trading profits, according to the SEC. The fine will be used to reimburse investors.

The SEC also charged Brian Stoker, the Citigroup employee primarily responsible for structuring the CDO transaction.

A lawyer for Stoker said he’s contesting the charges.

“He was not responsible for any alleged wrongdoing - he did not control or trade the position, did not prepare the disclosures and did not select the assets,” said Fraser Hunter of WilmerHale.

Credit Suisse Group (NYSE:CS) , the collateral manager, was fined $2.5 million because it allowed Citi to influence the portfolio and also was responsible for disclosure. Samir H. Bhatt, the portfolio manager at Credit Suisse mostly responsible, agreed to a six-month suspension as an investment adviser and a $50,000 fine.

A spokesman for Credit Suisse declined to comment.

The fine is the agency’s third largest since the financial crisis, trailing only the $550 million Goldman Sachs Group Inc. (NYSE:GS) paid to settle charges relating from a similar case of structuring a housing-backed investment gone bad, and the $300 million State Street Corp. (NYSE:STT) paid over allegations that it misled investors over a money-market fund that was invested in subprime loans.

Citi Slapped with $500K Fine: "The Financial Industry Regulatory Authority has assessed a $500,000 fine against Citigroup for its failure to pick up on an internal fraud event that lasted more than eight years.

According to FINRA, Citi's negligence in adequately supervising Tamara Moon, a former sales assistant at a Citi branch in Palo Alto, Calif., resulted in $749,978 being skimmed from the accounts of 22 Citi customers. Moon allegedly falsified account records and performed unauthorized trades that targeted elderly, ill or "otherwise vulnerable" accountholders."

FT.com / Companies / Banks - Citi fined amid tax crackdown: "Citigroup is to be fined over derivatives transactions that were partly designed to help foreign clients avoid taxes on dividends in a move that could herald a wider crackdown against Wall Street banks that used similar strategies.

The $600,000 fine by the Financial Industry Regulatory Authority, which oversees broker-dealers, comes after the US authorities hardened their stance on offshore tax operations with a series of actions over the past few months."

RBI fines Citi 25L in Gurgaon fraud case - The Times of India: "MUMBAI: The Reserve Bank of India (RBI) has imposed a penalty of Rs 25 lakh on Citibank for violating "know your customer" and anti-money laundering norms while opening accounts which led to the Gurgaon fraud.

According to sources, RBI had issued a show-cause notice to the bank on April 21 seeking to know why a fine of Rs 50 lakh should not be imposed on the bank. Based on the facts of the case and the bank's reply and also oral submissions made during the personal hearings held on June 7, 2011, RBI came to the conclusion that the violations were substantiated but brought down the penalty to Rs 25 lakh. "