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A Citibank branch in New York City in July. Photo: Ron Adar/SOPA Images/LightRocket via Getty Images

Banking regulators on Wednesday fined Citigroup $400 million for "its long-standing failure" to improve its risk-management systems, according to statement from the Office of Comptroller of the Currency (OCC).

Where it stands: A consent decree issued simultaneously from the Federal Reserve said the bank did not adequately address previous problems the Fed had identified related to "various areas of risk management and internal controls."

  • The order cited "deficiencies in Citigroup’s antimoney laundering compliance program" and its "control infrastructure relating to its foreign exchange program and designated market activities." The Fed ordered Citi to correct the issues in 2013 and 2015, respectively.
  • The fine comes less than a month after Citi's CEO Michael Corbat announced that he would retire from the the company in February 2021.

What they're saying: "The agency also issued a cease and desist order requiring the bank to take broad and comprehensive corrective actions to improve risk management, data governance, and internal controls," the OCC said.

The other side: “We are disappointed that we have fallen short of our regulators’ expectations, and we are fully committed to thoroughly addressing the issues identified in the Consent Orders," Citi said in a statement Wednesday.

  • “Citi has significant remediation projects underway to strengthen our controls, infrastructure and governance. These projects are each multi-year and have received significant investment."
  • "However, while we have made progress in each of these areas, we recognize that substantial improvement is still required to meet the standards we have set for ourselves and that our regulators expect of us."

The bottom line, via Axios' Felix Salmon: The findings from the OCC and the Federal Reserve will reinforce calls for America’s biggest banks to be broken up on the grounds that they are “too big to manage."

Editor's note: This story has been updated to reflect that Citi's CEO Michael Corbat did not resign in September but instead announced that month that he would retire from the company in February 2021.

Go deeper

Dion Rabouin, author of Markets
Oct 14, 2020 - Economy & Business

China's digital currency aims to leave the rest of the world in the dust

Illustration: Sarah Grillo/Axios

China is already test-driving the future of finance while the rest of the world is stuck trying to get its learner's permit.

What's happening: Over the past two weeks Chinese authorities in cities like Shenzhen and Chengdu have given out the country's brand new digital renminbi currency and are urging even faster rollout of the token nationwide.

The Biden protection plan

Joe Biden announces his first run for the presidency in June 1987. Photo: Howard L. Sachs/CNP/Getty Images

The Joe Biden who became the 46th president on Wednesday isn't the same blabbermouth who failed in 1988 and 2008.

Why it matters: Biden now heeds guidance about staying on task with speeches and no longer worries a gaffe or two will cost him an election. His staff also limits the places where he speaks freely and off the cuff. This Biden protective bubble will only tighten in the months ahead, aides tell Axios.

Bush labels Clyburn the “savior” for Democrats

House Majority Whip James Clyburn takes a selfie Wednesday with former President George W. Bush. Photo: Patrick Semansky-Pool/Getty Images

Former President George W. Bush credited Rep. James Clyburn with being the "savior" of the Democratic Party, telling the South Carolinian at Wednesday's inauguration his endorsement allowed Joe Biden to win the party's presidential nomination.

Why it matters: The nation's last two-term Republican president also said Clyburn's nod allowed for the transfer of power, because he felt only Biden had the ability to unseat President Trump.