Fed instructs Citigroup(NYSE:C) to clean-up its money-laundering scans - HSBC

Northern, WI 03/27/2013 (usmarketsdaily) - Citigroup Inc (NYSE:C) (Current: $44.83, Up by 0.76%) has been ordered by the Federal Reserve to pull up its socks as far as compliance with anti-money laundering policies is concerned. The company had been subjected to several similar directives from the Fed in 2012 as well and it has now been given 60 days to submit its plan to the authorities. The Fed said that the company has to have a transparent and proactive approach to the identification and management of any money-laundering risks that occur within the organization. It has been asked to spruce up its actions and anti-money laundering requirements as well as compliance operations. They will have to submit a complete review on these parameters within 90 days.

Disturbing trend
The bank said that it has been in efforts to improve its compliance, addressed all possible risks within its workings and is progressing very well on that front. They will ensure that the program runs smoothly and proves to be a sustainable one. Globally, an increased number of international banks have been coming under scrutiny and are being penalized for various indiscretions. In December, HSBC Holdings plc (NYSE:HBC) (Current: $53.21, Up by 0.72%) had to pay a whopping $1.9 billion. They had failed to detect the flow of money from drug trafficking that took place between Mexico and the U.S.

In April 2012 Citigroup Inc (NYSE:C) ran into rough weather with compliance of the Bank Secrecy Act. Following that order, Banamex USA which is the U.S arm of the Mexican subsidiary of Citigroup was instructed to address issues with its compliance program. Though the Fed did not divulge any details about the exact measures that are going to be undertaken by Citigroup to fix the issues, they said that the bank has been asked to look at discrepancies at the holding company levels as well.

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Coper graduated from the University of Chicagi with majors in political science and journalism.

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