Citigroup Inc. said Friday it is being investigated for hiring practices that might violate the FCPA.
The bank said the SEC and other agencies are “conducting investigations or making inquiries concerning compliance with the Foreign Corrupt Practices Act and other laws.”
The probe is aimed at the hiring of candidates “referred by or related to foreign government officials.”
Citigroup said it is cooperating with the investigation. It didn’t disclose other details or say what countries might be involved.
In November 2016, JPMorgan Chase and a Hong Kong subsidiary paid $264.4 million to the DOJ, SEC, and Federal Reserve to resolve FCPA offenses for awarding jobs to relatives and friends of Chinese government officials to win banking deals.
Hiring a family member or friend of a government official isn’t always a violation of the FCPA. But a hiring decision intended to reward or induce an official to award work can be an offense.
In August 2015, BNY Mellon paid $14.8 million to settle SEC charges that it violated the FCPA by giving student internships to family members of officials affiliated with a Middle Eastern sovereign wealth fund.
In March 2016, Qualcomm paid the SEC $7.5 million to settle FCPA offenses for hiring relatives of Chinese government officials to win sales.
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Here’s the full FCPA disclosure from page 291 of Citigroup Inc.’s Form 10-K filed with the SEC on February 24, 2017:
Government and regulatory agencies in the U.S., including the SEC, are conducting investigations or making inquiries concerning compliance with the Foreign Corrupt Practices Act and other laws with respect to the hiring of candidates referred by or related to foreign government officials. Citigroup is cooperating with the investigations and inquiries.
Richard L. Cassin is the publisher and editor of the FCPA Blog.