Boston, MA 08/13/2014 (wallstreetpr) – Diversified financial services provider Citigroup Inc (NYSE:C)’s subsidiaries have been reportedly under the scanner of the investigator for their alleged role in the $4.4 billion money laundering issue that had been tied with Petroleo Brasileiro SA.
Probe Into Money Laundering
The investigation of money laundering that was linked with Petrobras has percolated into financial institutions since the prosecutors were probing them from the perspective of compliance requirements. However, the financial institutions have reportedly said that have met the requirements of compliance and did not want to go beyond that.
There are several banks’ subsidiaries such as HSBC Holdings, Citigroup Inc (NYSE:C), Santander SA and Itau Unibanco Holding SA apart from Banco Bradesco SA were either holding accounts or engaged in executing operations that were related to the alleged money laundering of ten billion reais.
Investigators Review Bank Documents
Spokesman for the prosecutor’s group of six, Prosecutor Carlos Fernando Lima said that they were reviewing the bank documents submitted by the central bank and the police. He refused to pin-point any banks since the group was yet to initiate a formal prosecution. He also said that there was nothing clear-cut to say whether any wrongdoing was committed by the institutions.
The prosecutor told an interviewer in Curitiba that his experience was that there could not have been a big money laundering in the absence of someone from within the financial institution and that it should not have escaped the authorities’ eyes as the amount involved was big.
Modus Operandi
The allegation of $4.4 billion money laundering came from Brazilians, who wanted to dodge tax officials, money routed from drug trafficking and alleged misappropriation of funds from Petrobras contracts, the police press statement and court documents have reportedly revealed.
The role of foreign exchange traders were also there since they route the money from their Brazilian clients and deposit in abroad from unrelated accounts for fees. It meant that the forex traders had allowed their clients to export cash without informing the tax officials.
