“All affected clients have been reimbursed and the firm has enhanced its policies and procedures, including discontinuing the use of certain legacy systems.”
In the Citigroup case, New York regulators said its Smith Barney unit overcharged about 47,000 customers more than $22.5 million in fees on its TRAK fund-wrap program, as well as other advisory accounts.
It’s not clear what time period the New York case covers. The state said an investor who initiated the case by filing a complaint with the attorney general’s office in 2012 had been overcharged for about four years.
A spokesperson for the attorney general’s office could not provide more details by press time Friday.
Citigroup began reimbursing customers in October 2014, and has returned $22.5 million, the state said in its release.
In an e-mail, Citigroup spokeswoman Danielle Romero-Apsilos said the firm was pleased to have the matter resolved.
Most of the overcharges were the result of Smith Barney failing to apply discounts that customers had negotiated on mutual-fund wrap programs. A wider review by the firm begun in October 2014 found more improper charges on other fee accounts, such as $4.6 million charged on accounts that had been frozen because of a death, transfer or regulatory inquiry.