You had one job, Citigroup. The banking giant’s brokerage group displayed “inaccurate research ratings” — namely, slapping “buy” ratings on stocks…
You had one job, Citigroup.
The banking giant’s brokerage group displayed “inaccurate research ratings” — namely, slapping “buy” ratings on stocks that were actually rated “sell,” and vice versa — to its brokers, retail customers and supervisors, the Financial Industry Regulatory Authority said Thursday.
Because of a faulty electronic data feed, some customers inadvertently owned “sell” rated stocks even when their portfolios prohibited it, Finra said. And some covered stocks received no rating, while stocks not covered by the bank were rated, Finra said.
More than 1,800 securities — or 38 percent of the stocks covered by the bank — were affected over a five-year period ending December 2015.
“The display and use of incomplete and inaccurate research ratings can have widespread, adverse consequences to customers,” Finra said in settlement documents.
“Even when such inaccuracies are caused by technology problems, firms should react quickly to address those errors,” said Susan Schroeder, FINRA Executive Vice President and Head of Enforcement.
As part of the settlement, Citigroup agreed to pay a $5.5 million fine and $6 million to compensate retail customers. It did not admit or deny wrongdoing.
“We are pleased to have the matter resolved,” Citigroup said in a statement.
