Kokomo Tribune; Kokomo, Indiana

Bonus content

March 1, 2014

Citigroup lowers 2013 profit on Mexico fraud

Citigroup reduced its 2013 earnings by $235 million on Friday, saying it was a victim of fraud committed by a Mexican oil services company to secure hundreds of millions of dollars in short-term loans.

The U.S. bank is seeking to recover the missing funds with the help of Mexican authorities.

The bank said that the oil services company — Oceanografia S.A. de C.V., or OSA — overstated by $400 million the business it was doing with Mexico's state-owned oil company Petróleos Mexicanos, or Pemex. OSA used falsified invoices as collateral for $585 million in loans from Citigroup's Mexican unit, Banamex, Citigroup said. But after an investigation, Citigroup could only verify $185 million of invoices.

Citi said that it believes the case is isolated, and it is moving to recover the money and identify anyone involved in the fraud.

Mexican authorities said they have taken control of OSA, in part, to help make sure Citi recoups the funds.

"We are exploring every available option to recoup the misappropriated funds and we will be relentless in pursuing their recovery," Citigroup CEO Michael Corbet said Friday.

One of the criticisms of Citigroup has been that it is so big, with so many businesses around the world, that it can't possibly stay on top of all of them. It gets more than half of its revenue from outside the U.S.

It appears that invoices from OSA were falsified to represent that Pemex had approved them, according to a memo from Corbat to employees on Friday.

A worker at Banamex processed them, Corbat wrote. It's not clear how many people were involved, he wrote.

He said Citi is doing a "rapid review" through Banamex, and all of Citi, of programs similar to the one involved in this case.

Corbat was a banker and a Citi lifer when he was named CEO in October 2012. The hope was that he would scrutinize Citi's operations in each country and make sure this sort of thing didn't happen, said Nancy Bush, an independent banking analyst.

Text Only | Photo Reprints
Bonus content
  • Teen Pilot-Crash [Duplicate] Family: Indiana teen pilot who crashed in ocean knew risks PLAINFIELD (AP) — Haris Suleman knew that flying around the world carried risks. But like adventurers before him, the 17-year-old pilot from Indiana also believed dreams aren't achieved without taking chances. "Why does any explorer undertake the nec

    July 24, 2014 1 Photo

  • Jamie Kennedy live in Kokomo this weekend Actor and stand-up comedian Jamie Kennedy said he's excited for his first-ever trip to the City of Firsts — a place he has heard only one thing about. He laughed Wednesday night, saying the only thing he's heard about Kokomo is that it's home to a pl

    July 24, 2014

  • Social Security Computer Woes [Duplicate] Social Security's $300M IT project doesn't work WASHINGTON (AP) — After spending nearly $300 million on a new computer system to handle disability claims, the Social Security Administration still can't get it to work. And officials can't say when it will. Six years ago, Social Security embarked on

    July 24, 2014 1 Photo

  • Awarded a Pell Grant? Better double-check WASHINGTON (AP) — Potentially tens of thousands of students awarded a Pell Grant or other need-based federal aid for the coming school year could find it taken away because of a mistake in filling out the form. The mistake primarily stems from an onl

    July 24, 2014

  • Film Review Lucy [Duplicate] Review: 'Lucy' won't stretch your brain capacity So let's start with the enticing premise of Luc Besson's "Lucy," starring Scarlett Johansson: Human beings only use 10 percent of their brain capacity. Imagine what it would be like if we could access all of it? Well, wow. It would be sort of like ..

    July 24, 2014 1 Photo

  • Arizona inmate dies 2 hours after execution began PHOENIX (AP) — A condemned Arizona inmate gasped for more than an hour and a half during his execution Wednesday before he died in an episode sure to add to the scrutiny surrounding the death penalty in the U.S. Arizona Attorney General Tom Horne's o

    July 24, 2014

  • Obama [Duplicate] Obama wants limits on US company mergers abroad LOS ANGELES (AP) — President Barack Obama is tapping into growing misgivings about tax-driven overseas mergers by U.S. corporations, issuing a new call to end the practice quickly and questioning the patriotism and citizenship of those companies. The

    July 24, 2014 1 Photo

  • Court rules prison agency mistreated former Pendleton counselor INDIANAPOLIS (AP) — A federal appeals court has ruled that Indiana's prison agency mistreated a female employee when it shrugged off her complaints about workers having sex on her desk and later fired her for having an affair with an official. The ap

    July 23, 2014

  • Porch Shooting [Duplicate] Porch shooter's lawyer says he feared for his life DETROIT (AP) — A defense lawyer for a Detroit-area man who killed an unarmed woman on his porch says he repeatedly heard poundings — "boom, boom, boom" — outside his home before he opened the door and shot her in the face. Jurors heard opening statem

    July 23, 2014 2 Photos

  • George Harrison Tree-Beetles-6 [Duplicate] [Duplicate] George Harrison memorial tree killed by beetles LOS ANGELES (AP) — A tree planted in Los Angeles to honor former Beatle George Harrison has been killed — by beetles. Councilman Tom LaBonge says the pine grew to more than 12 feet tall before succumbing to a bark beetle infestation. The tree was rem

    July 23, 2014 1 Photo

Latest news
Featured Ads
Only on our website
AP Video
Arizona Prison Chief: Execution Wasn't Botched Calif. Police Investigate Peacock Shooting Death Raw: Protesters, Soldiers Clash in West Bank Police: Doctor Who Shot Gunman 'Saved Lives' 'Modern Family' Star on Gay Athletes Coming Out MN Twins Debut Beer Vending Machine DA: Pa. Doctor Fired Back at Hospital Gunman Raw: Iowa Police Dash Cam Shows Wild Chase Obama Seeks Limits on US Company Mergers Abroad Large Family to Share NJ Lottery Winnings U.S. Flights to Israel Resume After Ban Lifted Official: Air Algerie Flight 'probably Crashed' TSA Administrator on Politics and Flight Bans Raw: National Guard Helps Battle WA Wildfires Raw: Ukraine's Donetsk Residents Flee Senators Push to End Hamas Threat in Cease-Fire A Young Victim's Premonition, Hug Before MH17 Raw: Deadly Storm Hits Virginia Campground Death Penalty Expert: 'This is a Turning Point' Raw: MH17 Victim's Bodies Arrive in Netherlands
Parade
Magazine

Click HERE to read all your Parade favorites including Hollywood Wire, Celebrity interviews and photo galleries, Food recipes and cooking tips, Games and lots more.
Obituaries
Poll
Kelly Lafferty's video on Tom Miller