Indonesia's Central Bank barred Citigroup from opening New Branches in Indonesia

Indonesia's central bank barred Citigroup from opening new branches in the country for one year. Also the bank slapped a slew of sanctions amid findings that the global banking major, Citigroup violated various regulations in the country. The latest sanctions by Bank Indonesia were slapped at a time when Citi's Indonesian operations are plagued by allegations of fund embezzlement by an employee to the tune of millions of dollars.

Citi was also barred from issuing credit card to new customers for two years and prohibited the use of credit card billing services by third parties for two years. Bank Indonesia also ordered Citi to dismiss non-executive employees who are directly involved in the wealth management and credit-card services.

As a follow-up measure to the problems plaguing Citibank associated with priority services (Citigold) and credit cards, Bank Indonesia conducted a special audit to confirm violations of prevailing regulations. The investigation unearthed violations of internal bank regulations as well as exposed weaknesses in the application of risk management.