WASHINGTON — A federal ground jury is probing Citigroup, including its Banamex USA affiliate, over compliance with the U.S. Bank Secrecy Act and anti-money laundering requirements, according to the company.
In an annual filing on Monday with the U.S. Securities and Exchange Commission (SEC), the company said the probe includes subpoenas from the U.S. Attorney’s Office for the District of Massachusetts.
Banamex USA received a subpoena from the U.S. Federal Deposit Insurance Corporation (FDIC), according to the company. While the U.S. attorney may bring criminal charges, the FDIC is a civil agency.
The criminal probe follows other problems that have surfaced with Banamex, which operates Citigroup’s largest consumer bank outside of the United States and has been portrayed by the company as a model of its global strategy.
Citigroup received a grand jury subpoena seeking information about two mortgage securities that were issued in the middle of 2007, according to the company.
It is the first time that the bank has raised the prospect of involvement in a criminal case concerning the sale of mortgage bonds prior to the 2008 financial crisis.
It received several subpoenas and requests for information from several state attorneys general and the SEC about its mortgage bond business, according to the bank.