FX.co ★ FCA Fines Citigroup Global Of GBP 27.77 Mln For Trading System Failures, PRA Imposes GBP 33.89 Mln

The Financial Conduct Authority (FCA) announced on Wednesday that it has levied a fine of £27.77 million on Citigroup Global Markets Ltd. (CGML) due to failures in their systems and controls. The FCA reported that CGML had inappropriately sold $1.4 billion worth of equities in European markets without the necessary permissions.

In a parallel investigation, the Prudential Regulation Authority (PRA) also imposed a financial penalty of £33.89 million on CGML.

CGML accepted the FCA's findings without contesting them and agreed to settle. This agreement qualifies them for a 30% reduction on the originally proposed fine of £39.67 million.

According to the FCA, on May 2, 2022, a CGML trader intended to sell a basket of equities amounting to $58 million. However, an input error during the order entry resulted in a basket valued at $444 billion.

The internal controls at CGML managed to block $255 billion of the erroneous basket, but $189 billion still proceeded to a trading algorithm. The FCA emphasized that the firm's real-time monitoring procedures were ineffective in this instance.