An internal investigation found out that the traders misled clients.
Citigroup Hong Kong has fired eight traders and suspended three others following the results of an internal investigation which revealed that they had misled clients, reports FInancial Times.
The equity traders had taken the other side of client trades using the bank’s own balance sheet to make Citi a principal when the clients had been told that the bank was only acting as an agent, sources were quoted in FT.
The bank said in a statement that it “identified personal conduct that did not meet our standards and we have taken appropriate action. Instances where the capacity in which Citi was acting was not accurately represented were detected in relation to facilitation trading.”
The warning comes after the Hong Kong securities regulator slapped a combined $100m fine on global banks including UBS, Standard Chartered, Merrill Lynch and Morgan Stanely over IPO sponsor failures. In 2017, the Securities and Financial Commission (SFC) fined Citigroup $7m for failing to conduct due diligence as the sole sponsor of Real Gold Mining’s IPO in 2009.
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