CityNews has been saying for some time now that Citigroup CEO Chuck Prince is playing a dangerous game. By getting three senior executives to resign recently, seemingly for shortcomings related to that private banking debacle in Japan, he is indicating that the buck stops at the top. Well almost the top, in any event. Chuck had better be careful, however, that he is not the next victim of his own house-cleaning campaign - one more strike and the Citigroup boss himself may find that he is required to fall on his own sword.
And Thomas Jones, the former head of Citigroup's investment and asset management business (which included the private bank) and one of the three executives mentioned above, appears to agree. According to The Wall Street Journal, Jones stated in a recent interview: 'What is the standard of accountability ?....If that standard is applied at two levels above the point of error, then I am in that line of responsibility. But it ought to be done uniformly. I am no more culpable in Japan (where Citigroup lost its private banking licence due to regulatory and compliance issues) than are Chuck Prince, Bob Willumstad (President and COO, Citigroup) and Doug Peterson (CEO and Chairman, Citigroup Japan)'.
Jones, it seems, will not go quietly. He says that the follow-up report on the problems in Japan mentions him by name in only two footnotes and that his name did not feature in the list provided by Citigroup to Japanese regulators, which detailed the names of managers 'responsible' for the shortcomings there. The former Citigroup man's lawyer is quoted, saying: 'Chuck Prince can fire anyone he wants....But he can't do it in a manner that destroys his career and defames him. I want them to make it up to him'. Settlement or litigation looms, methinks.
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