Citigroup has reassigned a critical portion of its data compliance responsibilities following a series of regulatory setbacks.
Chief Operating Officer Anand Selva will no longer have sole oversight of the bank’s data compliance overhaul, after the bank was fined $136 million in June for inaccurately reporting loans to regulators. Instead, responsibility will now be shared with Tim Ryan, the bank’s Chief Technology Officer and a former PwC partner who joined Citi in June, according to a Financial Times report.
This shift in leadership comes after a history of compliance failures at Citigroup. The issues date back to 2020 when the Office of the Comptroller of the Currency (OCC) imposed a $400 million fine and a cease-and-desist order due to deficiencies in risk management, data governance, and internal controls. The errors were attributed to outdated software that had caused a $1 billion wire transfer mistake, leading to the initial OCC investigation.
Citi’s struggles continued into 2023. In May, the bank was fined £62 million for failing to catch a $1.4 billion trading error that affected European markets. Despite efforts to address these issues, the latest $136 million penalty underscored the ongoing challenges in Citigroup’s risk management and data compliance processes.
Tim Ryan is now the third senior executive in three years tasked with managing Citigroup’s data compliance overhaul. The changes are part of a broader initiative led by CEO Jane Fraser to rectify the bank’s deficiencies. Fraser has previously acknowledged shortcomings in the bank’s risk controls and has promised to increase efforts to meet regulatory expectations.
Citi has added thousands of employees over recent years to improve its compliance infrastructure, but progress has been slow, with the bank consistently missing milestones. The decision to have Ryan share oversight with Selva is seen as an attempt to accelerate the bank’s efforts.
The changes come at a time when Citi is also dealing with a lawsuit filed by former employee Kathleen Martin, who alleges that she was terminated for refusing to provide false information to regulators about the bank’s data compliance. Martin claims that Selva instructed her to withhold critical information regarding the bank’s progress on fixing its compliance issues. Citigroup is contesting the lawsuit, stating that Martin’s termination was performance-related.
Citi made no comments.
With input from Financial Times, the Banker, Finextra.
