Citigroup Faces Criminal Probe for Fraud at Mexico Unit - Source
April 4, 2014 3:25 PM EST
Citigroup disclosed in February it had discovered at least $400 million in fraudulent loans in its Mexico subsidiary, Banco Nacional de Mexico, known as Banamex, and said employees may have been in on the crime.
The bad loans were made to Mexican oil services company Oceanografia, a contractor for Mexican state-owned oil company Pemex.
The investigation, overseen by the FBI and prosecutors from the United States attorney's office in Manhattan, is focusing on whether holes in Citigroup's internal controls contributed to the fraud in Mexico, the newspaper reported.
The FBI and prosecutors are questioning whether Citigroup was equal parts victim and enabler, the newspaper said.
Representatives of the U.S. attorney's office in Manhattan and Citigroup declined comment. The FBI did not immediately respond to a request for comment.
Reuters reported in February that the U.S. Federal Bureau of Investigation was aware of Citigroup's loan losses due to fraud by a Mexican company and was monitoring the situation for possible criminal activity.
Banamex fired two bond traders after uncovering rogue trading last year, two sources close to the matter told Reuters on Tuesday, raising fresh questions over what controls the troubled unit had in place to police employees.
Most Popular Slideshows
Join the Conversation
- NATO: Russia's Been Conducting Too Many Military Flights Over Europe
- Nokia Lumia 730 v. Sharp Aquos Crystal – Specifications, Features And Price Showdown
- Moto X 2014 vs. Motorola DROID Turbo - Specifications, Features And Price Showdown
- Apple iPhone 6 Plus vs Motorola Droid Turbo: Comparsion On Processor, Software And Battery
- Australia Special Forces Await 'Delayed' Iraqi Visas Before Joining ISIS Fight
- ISIS Has Been Equipped With Advanced Anti-Aircraft Missiles
- Samsung Galaxy Note 4 vs Motorola Droid Turbo – S-Pen Is Note’s 4 USP But Droid Turbo Can Outshine With Larger Battery