On Wednesday, the U.S. bank regulator Federal Reserve Board and the Office of the Comptroller of the Currency (OCC) have fined Citigroup Inc (NYSE:C) $135.6 million for failing to comply with a 2020 enforcement action.
The Office of the Comptroller of the Currency (OCC) has amended its October 7, 2020, Cease and Desist Order against the financial institution.
This penalty is part of a larger effort, coordinated with the Office of the (OCC), to address ongoing issues with Citigroup's data quality management and risk controls.
Citigroup has been under scrutiny for its inadequate progress in addressing data management problems identified in the 2020 enforcement action.
The fine includes the $60.6 million fine from the Federal Reserve and additional penalties imposed by the OCC.
The regulatory bodies aim to hold Citigroup accountable and ensure that necessary improvements are made to its risk management and data quality practices. Failure to comply may result in further penalties and regulatory actions.
The penalties are part of CEO Jane Fraser's ongoing struggle to resolve regulatory shortcomings and streamline Citigroup's structure following significant layoffs, reported Reuters.
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In 2020, the bank was fined $400 million for ongoing deficiencies in risk management and data quality controls.
Fraser acknowledged the setbacks in a memo to employees, emphasizing the importance of staying focused on the bank's broader goals.
Fraser has intensified efforts to address the regulatory issues, stating that while progress has been made in simplifying the firm's structure and addressing consent orders, more work is needed, particularly in data quality management.
"Citi will spend what is necessary to address the regulatory issues," Fraser said.
Citigroup plans to invest the necessary resources to meet regulatory requirements despite challenges along the way.
Citigroup stock has gained more than 43% in the last 12 months. Investors can gain access to the stock via First Trust Nasdaq Bank ETF (NASDAQ:FTXO) and Opal Dividend Income ETF (NYSE:DIVZ).
Price Action: C shares are trading lower by 2.05% at $65.61 at the last check on Thursday.
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