Friday, July 11, 2014

Citigroup lowers 4Q, 2013 results on Mexican fraud

February 28. 2014 9:38AM
Associated Press

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(AP) Citigroup is lowering its fourth-quarter and full-year financial results after discovering fraud at a Mexican subsidiary.

The bank said Friday that it had extended credit to Mexican oil services company Oceanografia SA de CV through its Banco Nacional de Mexico unit, also known as Banamex. Oceanografia has been a key supplier to Mexican state-owned oil company Petrleos Mexicanos.

Citigroup Inc. said it found out earlier this month that Oceanografia had been suspended from receiving new Mexican government contracts. Citi and Petrleos Mexicanos then reviewed their exposure to Oceanografia.

Petrleos said that it found fraud in the accounts receivables recorded by Banamex.

Citigroup says its 2013 net income will be reduced to $13.7 billion from $13.9 billion. It believes the fraud is an isolated incident.

Citigroup's stock fell slightly in premarket trading.

Associated Press

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