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Citigroup Japan suspended from Japanese government bond auctions

Bloomberg TOKYO (Bloomberg) — Citigroup Inc. was suspended from the primary group of dealers that participate at certain Japanese government bond auctions after it was found to have manipulated futures prices, another strike against the lender’s markets business in Asia.

The Finance Ministry ordered Citigroup Global Markets Japan Inc.’s exclusion from participating in “non-price-competitive auctions” and certain other government bond sales for a month from June 13, it said in a statement Tuesday.

The suspension comes days after the Financial Services Agency fined the firm ¥133 million and ordered it to improve internal controls for failing to detect instances of manipulation of the Japanese government bond market. Citigroup was found to have placed orders last October for JGB futures contracts without intending to execute them, a practice known as spoofing. “The company had deficiency in trade surveillance related to market transactions of derivatives,” the ministry said.Speech

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