UPDATE 2-Citi to shut Banamex USA, pay $140 mln fine

miércoles 22 de julio de 2015 15:56 GYT

(Adds comment from regulator, background on criminal investigation)

July 22 (Reuters) - Citigroup Inc said it would shut its Banamex USA operations and pay $140 million to regulators who alleged the bank did not correct weaknesses they had found in 2012 in its anti-money laundering programs.

The fine, imposed by the Federal Deposit Insurance Corp, includes $40 million in civil penalties to be paid to California's Department of Business Oversight.

"Banamex agreed three years ago to correct numerous weaknesses in its anti-money laundering program. It has failed to do so," Jan Lynn Owen, commissioner of the California authority said in a statement on Wednesday.

California-based Banamex USA is an affiliate of Banco Nacional de Mexico (Banamex), which Citigroup bought in August 2001. Banamex USA had $1.5 billion of assets at the end of 2012, and at one point as many as 11 branches, eight of which were closed in 2013.

The payment, the largest by a bank to the California regulator, resolves allegations that Banamex USA violated federal laws requiring banks to maintain adequate anti-money laundering programs, the California regulator said.

A federal grand jury and the U.S. Attorney's office in Massachusetts have also been investigating the Banamex USA's compliance with anti-money laundering requirements and the Bank Secrecy Act, Citigroup has previously disclosed.

A bank spokeswoman declined to comment on the status of that criminal investigation. The bank previously said it was cooperating with that probe and with the FDIC and California investigations.

Citigroup said it a statement on Wednesday that it will liquidate Banamex USA, which now has three branches, 300 full-time employees and $500 million of assets.   Continuación...