All Articles Tagged "citigroup"
(Rolling Out) — Legally blind former Citigroup VP Gary Foster had no trouble seeing dollar signs when he devised a scheme to embezzle an estimated $22 million from his employer. Foster, 35, pleaded guilty in a Brooklyn, N.Y., federal courtroom to bank fraud charges, telling the judge, “I did this from my Citigroup office …” He faces up to 10 years in prison, and may be fined as much as $44 million, as part of a plea deal he worked out with federal prosecutors. Of the 12 years Foster spent working for Citigroup, the last eight were spent siphoning off cash — wiring it into his personal Chase bank account. He quit his job in January and was arrested by federal agents in June upon his return from a Bangkok vacation. As a Citigroup VP, Foster earned $100,000 annually, but he lived an extravagant lifestyle that included the purchase of a Ferrari, a Maserati GranTurismo and a BMW 550i — along with the services of a personal chauffeur to drive him around in the cars.
When Gary Foster left for his vacation in Bangkok, he was a wealthy and successful man who most likely thought he had it all. But his trip was cut short when he received information that his former employer suspected the secret behind his success was an elaborate embezzlement scheme.
Bloomberg reports that Foster, a former Citigroup Inc. vice president, is accused of stealing $19 million from the bank and transferring the money to his private account with JP Morgan Chase. The alleged fraud lasted from May 2009 to the end of 2010.
The NY Post reports he used the money to buy a Garden State house for his parents and pay off a mortgage for his ex-wife. He also spent $3 million on a six-bedroom mansion in Englewood Cliffs, NJ and $1.93 million on a Rockefeller Center apartment directly across from the Citi branch on West 48th Street.
“We are outraged by the actions of this former employee,” spokeswoman Shannon Bell from the Citigroup based in New York said in a June e-mail to Bloomberg. “Citi informed law enforcement immediately upon discovery of the suspicious transactions and we are cooperating fully to ensure Mr. Foster is prosecuted to the full extent of the law.”
The thirty-five year old New Jersey native came back from his Bangkok trip early upon hearing that he was under investigation. He was arrested in June at the John F Kennedy International Airport in New York and charged with bank fraud. On June 27, he was released on an $800,000 bond secured by his parents. One of his lawyers, Isabelle A Kirshner, told Bloomberg that her client does intend to plead guilty to the charge.
US Attorney Loretta Lynch says that Foster allegedly committed the “ultimate inside job,” given his position and knowledge of bank operations.
The criminal complaint asserts that Foster managed to move $900,000 from an interest expense account and $14.4 million from a debt-adjustment account to the bank’s cash account between July to December of last year. A fake contract was then created to cover up Foster’s scheme under a pre-existing contract. Through a series of eight transfers, he then had the money wired from the cash account to his personal account.
Foster, who was hired by Citigroup in 1999, left his role voluntarily in January. In his role he supervised the derivative’s unit of Citigroup’s treasury finance department which funds loans and various business transactions within the bank. An internal audit revealed Foster’s wire transfers to his account.
If prosecutors find Foster guilty of the crime, he could face a maximum sentence of 30 years in prison.
Gary Foster, a black man and former vice president at Citigroup, is being accused of embezzling $18.4 million from the Wall Street giant. It was a one man heist that involved a series of secret money transfers, that resulted in his surrender at John F. Kennedy International Airport on Sunday night, directly off of a flight from Bangkok.
“According to a criminal complaint, Foster’s department financed loans and processed wire transfers within Citigroup. From May 2009 through to the end of last year, Foster siphoned funds from various Citigroup accounts, placed them in the bank’s cash account and then wired the money into his private account at another bank in New York,” The Sydney Morning Herald reports.
After helping himself to the company cash, he quit as VP of the treasury finance department in January before making a run for it. He had been travelling in southeast Asia when he heard that he’d been caught. He was released Monday on a $700,000 bond after appearing in federal court. Foster is now facing bank fraud charges that carry a maximum penalty of 30 years, the Herald reports.
At least this guy had the decency to quit while he was ahead, instead of being hauled out of his office for an even bigger spectacle. Either way, he obviously didn’t steal enough money to make sure he wouldn’t get caught.
(Businessweek) — Friday night, and the crowd at the bar in Harlem’s Lenox Lounge is a mix of neighborhood old timers and young hipsters who have come for the jazz club’s 1940s ambiance. Back in the Zebra Room, famous for walls decorated with striped animal skins, there’s a private party going on for the Jazz Foundation of America, a nonprofit group that helps indigent jazz and blues musicians pay their bills.
The room itself hasn’t changed much since Billie Holiday sang here decades ago, but tonight it’s filled with the foundation’s donors—mostly white hedge fund guys—and their female companions. A handful of guitarists, drummers, keyboard players, and even a saxophone-playing blues vocalist from New Orleans—most of them black—are standing by to provide the evening’s entertainment. The two groups maintain a polite but awkward distance.
Finally someone arrives who can bridge the cultural gulf. Richard D. Parsons, the 62-year-old chairman of Citigroup (C), strolls through the doorway with his wife, Laura. His beard is closely cropped and he wears rimless glasses, a brown sport coat, black shirt, and no tie. At 6 foot 4, he towers over his spouse. His singular talent, which has powered his career to the top of some of America’s most prominent—and troubled—companies, is one he demonstrates tonight as he mingles easily with the musicians and the money men: He is flat-out smooth.
(All Things Digital) – In the tech and media worlds, Google is a goliath. On Wall Street, at least this year, it’s a disappointment: Shares at the search giant are down some 20 percent for the year to date, while the rest of the market has been more or less flat. So today’s a chance for the company to impress investors again, as it unveils its Q2 earnings. In a lovely bit of timing, it has primed today’s pump with news that it convinced Omnicom to commit “hundreds of millions” of dollars into Google’s display ad exchange over the next two years.
(Financial Times) — Citigroup is moving to shrink its consumer finance unit, CitiFinancial, closing hundreds of branches across the country, in an effort to make the troubled unit more attractive to buyers. The restructuring of CitiFinancial, one of the cornerstones of Citi’s original plan for an all-encompassing “financial supermarket”, underlines the management’s desire to put the company’s turbulent past behind it.
(Bloomberg) — The U.S. Treasury Department plans to sell “up to” 1.5 billion shares of Citigroup Inc. in the government’s biggest step yet to exit the 27 percent ownership of the bank it rescued during the financial crisis.
The Treasury will give its agent, Morgan Stanley, “discretionary authority” to sell the amount, and expects to give clearance to sell additional shares thereafter, the department said in an e-mailed statement today. “Treasury will begin selling its common shares in the market in an orderly fashion under a pre-arranged written trading plan.”
(NYTimes) – The results, which beat analyst expectations and were the highest since the housing crisis began, was a result of the resurgence in the bond market and improvements in the economy, particularly overseas. Both play to Citigroup’s strengths as a major player in fixed income and emerging markets, and come as some of its rivals benefited from similar trends.
JPMorgan Chase and Bank of America both reported big first quarter profits from hefty trading profits and from adding less money to their loan loss reserves.
(cokReuters) – Major U.S. banks temporarily lowered their debt levels just before reporting in the past five quarters, making it appear their balance sheets were less risky, the Wall Street Journal said, citing data from the Federal Reserve Bank of New York.
The paper said on Friday 18 banks, including Goldman Sachs Group (GS.N), Morgan Stanley (MS.N), J.P. Morgan Chase (JPM.N) Bank of of America (BAC.N) and Citigroup (C.N), understated the debt levels used to fund securities trades by lowering them an average of 42 percent at the end of each period.
The banks had increased their debt in the middle of successive quarters, it said.
(CNNMoney.com) — This earnings season, investors won’t have the big banks to kick around anymore.
After a bumpy end to 2009, all six of the nation’s largest financial institutions are expected to report a profit for the first quarter. Even Citigroup (C, Fortune 500) and Bank of America (BAC, Fortune 500), long considered the laggards of the group, are both expected to report slim profits of less than a $1 billion each, after hemorrhaging a combined $13 billion last quarter as a result of paying back bailout funds to taxpayers.
The latest earnings season, which begins in earnest next Wednesday when JPMorgan Chase (JPM, Fortune 500) delivers its results before the opening bell, would represent the first time in a long, long while that all of the nation’s top financial institutions have collectively recorded a profit.