Thursday 8 September 2011

Citigroup banker faces 30 years in jail after admitting $22m fraud


Former Citigroup banker Gary Foster has pleaded guilty to embezzling $22m (£14m) from the bank, money he spent on a lavish lifestyle of fast cars and fancy apartments. He faces up to 30 years in jail. The 12-year Citigroup veteran spent hundreds of thousands on cars including a Ferrari and a Maserati Gran Turismo, even though he is legally blind and was unable to drive them. He hired a chauffeur. Foster, 35, was arrested in June at John F Kennedy Airport as he was getting off a flight from Bangkok. He had quit the bank in January before Citi had uncovered his scheme. A former treasury finance department executive, Foster earned $100,000 a year managing internal investments at the bank. Prosecutors said his scheme began in September 2003 and continued into 2011. He wired the money from internal Citi accounts into his personal bank account and covered up his tracks by assigning phony contract or deal numbers to the transfers to make them appear bona fide. According to prosecutors, between July and December 2010, he moved around $14.4m from Citigroup's debt adjustment account and $900,000 from the bank's interest expense account to his personal account in eight separate wire transfers. In a single transfer, on 8 November, he is alleged to have wired himself $3.9m. The US Attorney's Office in Brooklyn has already seized $16m in assets including his cars, an exclusive apartment in Manhattan's Rockefeller Centre, an apartment in Brooklyn and mansion in Englewood Cliffs, New Jersey. "The defendant violated his employer's trust and stole a stunning amount of money over an extended period of time to finance his personal lifestyle," said US attorney Loretta Lynch. "We will vigorously investigate and prosecute such conduct and seek to recover as much of the proceeds as possible."