Will Citigroup (C) Stock Be Affected by SEC Fine Over ‘Blue Sheet’ Data?

Citigroup (C) will pay $7 million and admit wrongdoing to settle SEC charges that the company gave the agency incomplete ‘blue sheet’ data.
By Kaya Yurieff ,

NEW YORK (TheStreet) -- Citigroup (C) - Get Report has agreed to pay $7 million and admit wrongdoing to settle SEC charges that the firm gave the agency incomplete "blue sheet" information, the Wall Street Journal reports.

There was a computer coding error in software the New York-based company used from May 1999 to April 2014 to process the SEC's requests for blue sheet data.

Blue sheets include the time, type, volume and prices of trades as well as other information, the Journal noted.

By using the software with the error, Citigroup left out 26,810 transactions in over 2,300 blue sheet requests.

Additionally, the firm did not report the incident to the SEC or try to provide the missing data until nine months after discovering the problem, according to the Journal.

"Broker-dealers have a core responsibility to promptly provide the SEC with accurate and complete trading data for us to analyze during enforcement investigations," Robert A. Cohen, co-chief of the SEC enforcement division's market abuse unit, told the Journal.

"Citigroup did not live up to that responsibility for an inexcusably long period of time, and it must pay the largest penalty to date for blue sheet violations," he added.

Shares of Citigroup are gaining 2.53% to $43.36 on Tuesday afternoon.

(Citigroup is held in Jim Cramer's charitable trust Action Alerts PLUS. See all of his holding with a free trial here.)

Separately, TheStreet Ratings Team has a "Hold" rating with a score of C+ on the stock.

The primary factors that have impacted the rating are mixed. The company's strengths can be seen in multiple areas, such as its attractive valuation levels, expanding profit margins and notable return on equity.

But the team also finds weaknesses including unimpressive growth in net income, weak operating cash flow and a generally disappointing performance in the stock itself.

Recently, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.

You can view the full analysis from the report here: C

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