You can now read 5 articles in a month for free on BostonGlobe.com. Read as much as you want anywhere and anytime for just 99¢.

Citigroup cites money laundering probe

NEW YORK — Citigroup and its Mexican subsidiary have received grand jury subpoenas from federal prosecutors over issues of compliance with anti-money-laundering and bank secrecy laws, the bank disclosed Monday.

The disclosure, in the bank’s annual securities filing, comes after Citigroup said its Mexican unit, Banamex, had been defrauded of as much as $400 million.

Continue reading below

The subpoenas were issued by the US attorney’s office in Massachusetts.

Also, Banamex USA got a subpoena from the Federal Deposit Insurance Corporation related to the Bank Secrecy Act and anti-money-laundering program, Citigroup said.

The purported fraud stems from a $585 million accounts receivable program Banamex had offered to an oil supply company, Oceanografia, in Mexico. Invoices for work Oceanografia was supposed to have completed were falsified, according to Citigroup.

A person briefed on the matter said it was suspected that a Banamex employee was involved in the fraud.

Citigroup’s chief executive, Michael L. Corbat, said in a memo to employees that it was unclear how many people were involved.

The investigations indicate the purported fraud in Mexico could have larger legal ramifications for the bank, which has been trying to put many of its problems related to the financial crisis behind it.

The Securities and Exchange Commission and the FBI are also looking into the mater, people briefed on the matter said on Friday.

Citigroup said it was cooperating fully with all of the inquiries.

Loading comments...
Subscriber Log In

We hope you've enjoyed your 5 free articles'

Stay informed with unlimited access to Boston’s trusted news source.

  • High-quality journalism from the region’s largest newsroom
  • Convenient access across all of your devices
  • Today’s Headlines daily newsletter
  • Subscriber-only access to exclusive offers, events, contests, eBooks, and more
  • Less than 25¢ a week
Marketing image of BostonGlobe.com
Marketing image of BostonGlobe.com
Already a subscriber?
Your city. Your stories. Your Globe.
Yours FREE for two weeks.
Enjoy free unlimited access to Globe.com for the next two weeks.
Limited time only - No credit card required!
BostonGlobe.com complimentary digital access has been provided to you, without a subscription, for free starting today and ending in 14 days. After the free trial period, your free BostonGlobe.com digital access will stop immediately unless you sign up for BostonGlobe.com digital subscription. Current print and digital subscribers are not eligible for the free trial.
Thanks & Welcome to Globe.com
You now have unlimited access for the next two weeks.
BostonGlobe.com complimentary digital access has been provided to you, without a subscription, for free starting today and ending in 14 days. After the free trial period, your free BostonGlobe.com digital access will stop immediately unless you sign up for BostonGlobe.com digital subscription. Current print and digital subscribers are not eligible for the free trial.