March 12, 2014 / 12:57 AM / 5 years ago

Top Citigroup executives take lead on Banamex probe: WSJ

A logo of Banamex is seen in Mexico City February 28, 2014. REUTERS/Edgard Garrido

(Reuters) - Top Citigroup Inc executives Manuel Medina-Mora and Brian Leach are taking the lead on an internal probe into alleged fraud at the U.S. bank’s Mexican unit Banamex, the Wall Street Journal reported, citing people familiar with the matter.

Citigroup said in February it had discovered at least $400 million in fraudulent loans at its Mexico subsidiary and said employees may have been involved in the apparent crime.

Leach, the bank's head of franchise risk and strategy, is leading the internal investigation, while Medina-Mora, the bank's co-president and chairman of Mexico, is spending most of his time on the probe, the paper said. (

Both executives are working with the Mexican police, who are focusing on a lower-level Banamex employee, as well as the person’s co-workers and direct supervisors, people familiar with the situation told the Journal.

The bad loans were made to Mexican oil services company Oceanografia, a contractor for Mexican state-owned oil company Pemex. Oceanografia borrowed from the Mexican unit, Banco Nacional de Mexico, known as Banamex, using expected payments from Pemex as collateral.

Citigroup was not immediately available for comment outside of U.S. business hours.

Reporting by Mridhula Raghavan in Bangalore; Editing by Richard Pullin

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