Written by Jonathan Stempel and Saeed Azhar
- Reuters, New York City -A former managing director claimed the bank fired her in punishment for not lying to regulators about the firm’s risk management procedures, and Citigroup requested a court to reject the action. As per a complaint made on Thursday night in Manhattan federal court, the third-largest U.S. bank claimed that Kathleen Martin was fired in November due to her insufficient leadership and engagement abilities for her role as interim data transformation chair. According to Citigroup, Martin’s claims are untrue, and even if they were, her whistleblower was not covered under the federal Sarbanes-Oxley governance statute.
- Valdi Licul, an attorney for Martin from the Wigdor law firm, disregarded Citigroup’s argument.
- On June 18, Chief Executive Jane Fraser updated investors on the bank’s attempts to “modernize” its data reporting and automation in response to regulatory concerns. However, she also conceded that “progress has been too slow” in some areas.
- “Clean up its unlawful data maintenance practices and avoid further legal liability” was Martin’s claim about her hiring by Citigroup in 2021, the year the bank agreed to pay $400 million to federal authorities due to deficiencies in risk management.
- She said, however, that Chief Operating Officer Anand Selva encouraged her to conceal important data about the bank’s metrics from the Office of the Comptroller of the Currency (OCC), one of its regulators, to “make us look bad.”
- Citigroup claimed that Martin failed to specify which Sarbanes-Oxley clause she thought it breached when she filed for termination, and that workers who just “push back” against managers are not protected by the legislation.
- Additionally, Citigroup said that Martin made no claims about any wrongdoing or deliberate attempt to mislead shareholders.
- The bank with headquarters in New York refused to speak more on Friday. Fraser is not a defendant, but Selva is.
- Martin is requesting reinstatement, damages for emotional and reputational loss, and back salary and benefits.
- U.S. District Court, Southern District of New York, Case No. 24-03949. Martin v. Citibank NA et al.
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