Citigroup strips COO of responsibility for data compliance after the bank was hit with a $136m fine

Citigroup recently decided to strip its chief operating officer (COO) Anand Selva of his responsibility for data compliance, following a massive $136 million fine that the bank got hit with for failing to address long-standing deficiencies in data governance and risk management.

Citi Consistently Failed To Address Data Governance Issues

The move was reported by four inside sources familiar with the matter. Reports also say that Selva will have to share responsibility for data compliance with Tim Ryan, the former accountant and top PwC partner, who became involved with Citi earlier this year, in June.

The decision to strip the COO of certain responsibilities came after an entire string of compliance failures by Citi was identified. The failures date as far back as 2020. At the time, the Office of the Comptroller of the Currency (OCC) issued a cease and desist order. The OCC accompanied the order with a $400 million fine due to major deficiencies in the bank’s risk management, which spanned throughout the company.

The firm was also found to be lacking in compliance, internal controls, and data governance, which was considered unacceptable for the entity.

Back then, Citi claimed that faulty software was to blame, as it used technology dating back to the 1990s. It claimed that this was the reason for a $1 billion wire transfer screw-up that precipitated the OCC’s investigation.

After that, in May, the bank got another fine, this time for failing to catch a $1.4 billion trading error that ended up shocking the European market. For this mistake, Citi had to pay £62 million in fines.

Citi Got Fined Again This June

Finally, the bank was slapped with the latest $136 million penalty, which was issued in June, after the flawed reporting of tens of billions of dollars of loans to regulators. The bank drafted thousands of new staff, but it still kept consistently missing milestones, and all the while it kept showing a lack of sustainable progress amid weaknesses in data governance.

The bank even made changes at the top, which made Ryan, its acting CTO, the third senior Citi executive in three years to try and tackle the task of fixing its data problems, so far, seemingly with no success.

In addition to everything else, Citi is currently fighting a lawsuit filed by an ex-employee, who claimed that Citi terminated her contract for refusing to send false information to the regulators. The employee’s name is Kathleen Martin, and she filed the lawsuit in New York district federal court, claiming that the COO Selva was the one who instructed her to hide critical information from the OCC office to prevent the bank from looking bad.