The US Securities and Exchange Commission has slapped a $7 million fine on Citigroup to settle charges that a computer coding error caused the firm to provide the agency with incomplete 'blue sheet' information about trades it executed.
The snafu occurred in the software that Citigroup used from May 1999 to April 2014 to process SEC requests for blue sheet data, including the time of trades, types of trades, volume traded, prices, and other customer identifying information. During that 15-year period, Citigroup consequently omitted 26,810 securities transactions from its responses to more than 2,300 blue sheet requests, says the watchdog.
The SEC says that the bank further compounded the wrongdoing by failing to report the problems or take any steps to produce the omitted data until nine months later.
“Broker-dealers have a core responsibility to promptly provide the SEC with accurate and complete trading data for us to analyze during enforcement investigations,” said Robert Cohen, co-chief of the SEC Enforcement Division’s Market Abuse Unit. “Citigroup did not live up to that responsibility for an inexcusably long period of time, and it must pay the largest penalty to date for blue sheet violations.”
Previous violations of blue sheet trade reporting due to botched coding cost Credit Suisse Securities $4.25 million in September 2015, and Scottrade $2.5 million in January 2014.