Date
17 December 2017
Citigroup reached a settlement with the Justice Department and US attorney’s office in Boston for US$97.44 million, with no sanctions against the bank and a so-called non-prosecution agreement. Photo: WSJ
Citigroup reached a settlement with the Justice Department and US attorney’s office in Boston for US$97.44 million, with no sanctions against the bank and a so-called non-prosecution agreement. Photo: WSJ

Citigroup settles with DOJ over money laundering

Citigroup Inc. has agreed to pay less than US$100 million to settle a years-long money laundering investigation, the Wall Street Journal reports, citing the bank and government agencies.

The bank reached a settlement with the Justice Department and US attorney’s office in Boston for US$97.44 million, with no sanctions against Citigroup and a so-called non-prosecution agreement, according to the bank and Justice Department. The investigation centered on activity in the bank’s Banamex USA unit.

As part of the agreement, Citigroup admitted that Banamex USA violated the Bank Secrecy Act from at least 2007 until at least 2012.

The agreement is far less than previous money laundering settlements with large banks and is one of the first to emerge since the change in presidential administrations. Other deals with big banks have often topped US$1 billion and involved so-called deferred prosecution agreements or criminal guilty pleas.

In 2012, HSBC settled for about US$1.9 billion; in 2014 J.P. Morgan Chase  & Co. settled for about US$2 billion and BNP Paribas settled for nearly US$9 billion; and in 2015 Commerzbank settled for about US$1.5 billion.

Citigroup’s settlement is just the second nonprosecution agreement, known as an NPA, for a big bank in the last eight years. The other arose from J.P. Morgan’s settlement last year over hiring sons and daughters of Asian government officials, known as princelings.

Citigroup said in a statement that it was “pleased to resolve these matters.”

The bank said it would be finished with winding down Banamex USA by June 30. “Among our most serious obligations as a bank is to achieve the strongest possible system for anti-money-laundering and sanctions compliance to protect the integrity of the financial system,” the bank said.

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