Citi private bank in new accounts ban
Leaked documents show American group to tighten anti-money laundering controls
Citigroup’s private banking division, which globally has $28bn assets under management, has ceased taking new UK customers because of concerns over its anti-money laundering procedures, CityAM can reveal.
Leaked internal documents show that Citibank International Personal Bank (IPB) this week barred its staff from opening new accounts after an internal review found its anti-money laundering system required “urgent focus”.
IPB, which has 170,000 customers globally, has been in discussions with the Financial Services Authority and will provide the City watchdog with weekly updates until it is resolved. The FSA will also appoint an independent third party to review IPB’s systems. The regulator has powers to stop banks opening new accounts if there are not adequate anti-money laundering measures in place. However, it is not known if IPB was forced by the FSA to halt its new business or whether the decision was its own.
Yesterday, an IPB spokesman said the bank was “taking a pause” after growing by 70 per cent in the last year and that the matter was a “process and resource” issue. He emphasised that it was business as usual for existing customers.
IPB caters for wealthy customers, offering multi-currency bank accounts, as well as tax and inheritance planning.
In a review the FSA published last July into anti-money laundering systems it found that private banks were inherently attractive to criminals with significant funds to launder.