Citigroup's Mexican Unit Fined 30 Million Pesos Carrie Kahn - NPR.org
go to original October 17, 2014

A Banamex bank sign in Mexico City (Reuters)

Mexico's banking regulator has slapped a nearly 30 million peso ($2.2 million) fine on the Citigroup subsidiary Banamex, for failing to provide sufficient accounting controls. The regulator said the lack of oversight allowed the Mexican firm Oceanografia to allegedly dupe the bank out of $400 million.

Banamex had lent the money to Oceanografia, an oil services firm contracted by the state petroleum monopoly, PEMEX, based on invoices that turned out to be fake.

Oceanografia has not been charged with any wrongdoing but is under investigation. The company's CEO and controlling shareholder, Amado Yanez Osuna, had been under house arrest for nearly two months. He faces bank fraud charges in Mexico but was released earlier this summer after posting $6.2 million bond.

Citigroup fired 12 Banamex employees after discovering the alleged fraud, which also led to the resignation of several high-level employees, including Chief Executive Javier Arrigunaga, according to The Wall Street Journal.

Read the rest at NPR.org

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