Citi fined $2 mn over Facebook IPO leak

Oct 26, 2012
Citibank is the consumer banking arm of US banking giant Citigroup. The company paid a $2 million fine to a state regulator and fired a junior analyst over a probe into leaks of confidential information on Facebook's public offering, officials said Friday.

US banking giant Citigroup paid a $2 million fine to a state regulator and fired a junior analyst over a probe into leaks of confidential information on Facebook's public offering, officials said Friday.

A senior tech analyst also left Citi Friday, the banking group confirmed, after the Massachusetts investigation uncovered "prohibited contact" with a French business journalist on nonpublic estimates for 's .

"We are pleased to have this matter resolved," Citi said in a statement after the fine was announced by Massachusetts Commonwealth Secretary William Galvin.

"We take our internal policies and procedures very seriously and have taken the appropriate actions."

According to an agreement filed by the regulator, Citi terminated the employment of an unnamed junior analyst in September for disclosing research on Facebook which came from underwriters and was to remain confidential until 40 days after the IPO.

The document said the analyst released the to the news website TechCrunch, a unit of AOL. The leaked data included an analysis of "investment risks" and "investment positives" for Facebook ahead of the IPO in May.

The state official said the fine was for "improper disclosures of nonpublic information," including the Facebook IPO.

Citi also confirmed the "departure" of star tech analyst Mark Mahaney, who was the "senior analyst" cited by regulators.

The document said the senior analyst provided confidential revenue estimates for YouTube to a reporter for the French business publication Capital in April.

The regulator said the analyst violated company guidelines which prohibit discussion of an outlook for a company if this has not been published in a report.

Citi said Mahaney's departure "was not linked to ."

Explore further: Lufthansa outsources IT infrastructure ops to IBM

add to favorites email to friend print save as pdf

Related Stories

Regulators probe bank's role in Facebook IPO

May 23, 2012

(AP) -- Regulators are examining whether Morgan Stanley, the investment bank that shepherded Facebook through its highly publicized stock offering last week, selectively informed clients of an analyst's negative ...

Recommended for you

Turner channels removed from Dish amid pact spat

22 hours ago

Channels such as Cartoon Network and CNN are no longer part of Dish's programming lineup as a deadline has passed for the satellite TV provider and Turner Broadcasting to renew their distribution agreement.

Verizon reports higher 3Q net income, revenue

23 hours ago

Verizon Communications Inc. on Tuesday reported higher net income and revenue in its third quarter, helped by strong wireless subscriber growth and demand for its high-speed FiOS Internet services.

User comments : 1

Adjust slider to filter visible comments by rank

Display comments: newest first

SincerelyTwo
not rated yet Oct 26, 2012
$2m, that's it? ... that's not even a slap on the wrist, that's more like a gentle poke.