Monday, October 3, 2011

Citi Fined $770,000 For Failing To Report Employee Ponzi Scheme

Hong Kong's securities regulator has fined Citigroup (C.N) HK$6 million ($770,000) for failing to report a Ponzi scheme involving one of its former employees.

Citigroup will also compensate customers affected by the fraud and hire an external expert to review some of its operational practices and policies, the Securities and Futures Commission (SFC) said in a statement on Monday.

"Citi Asia not only failed to detect a Ponzi scheme operating under its nose, despite having the opportunity to do so, but then failed to report the scheme to the SFC in a timely way," the SFC's Executive Director of Enforcement Mark Steward said. The SFC said a Citi employee ran a fraudulent scheme between 2004 and 2009 involving 13 Citi Asia clients, who had invested through the employee on the basis that their money would be used to purchase U.S. Treasuries and other products…..

Read all about it at http://www.huffingtonpost.com/2011/10/03/citigroup-ponzi-scheme_n_991879.html

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