A former managing director at Citigroup has filed a lawsuit against the bank and its chief operating officer, alleging she was dismissed for opposing what she claims were attempts to provide false information to regulators.

Kathleen Martin, a former managing director whom Citi hired in 2021 to assist with data issues, stated in a lawsuit filed in a New York district federal court that her supervisor, chief operating officer Anand Selva, wanted her to conceal "critical information" from the Office of the Comptroller of the Currency (OCC) regarding the bank's data governance metrics.

Speaking on behalf of the bank and Selva, a Citigroup spokesperson issued a statement, saying, "this lawsuit is without merit, and we will vigorously defend against it."

The lawsuit alleges that Selva wanted to hide information because it would make the bank "look bad." Selva allegedly urged Martin to falsely inform the regulator that Citi had achieved particular goals when it had not, according to the lawsuit.

Martin was dismissed on 25 September, 2023, in retaliation for her complaints, the lawsuit claims. The data governance work was related to a 2020 OCC consent order, as per the lawsuit. Martin's attorney stated that her client "at all times acted to protect Citi's interests." She is urging the court to reinstate her with the same seniority status and is seeking back pay, including bonuses.

This news comes days after Citi was handed a £61.6 million penalty in the UK – the largest fine given to a bank in the country since the 2008 financial crisis. The Prudential Regulation Authority and Financial Conduct Authority imposed the hefty penalties after identifying persistent failures in Citi's trading systems and controls over a four-year period.

The penalty represents one of the largest for control failings since the global financial crisis over a decade ago. It highlights the regulatory scrutiny and consequences Citi faces not only for data governance issues, as alleged in the lawsuit, but also for weaknesses in its trading controls and risk management systems.

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