The New York Stock Exchange has fined Citigroup's Salomon Smith Barney $1 million for failing to supervise brokers who advised employees of WorldCom on borrowing to pay taxes on stockholdings, the New York Timesreported this morning.
The NYSE also ordered that Atlanta branch manager Mr Michael Grace take a "three-month supervisory suspension," the newspaper said. Salomon Smith Barney had relieved Mr Grace of his supervisory duties at the end of 2001, the paper said.
The Citigroup unit, which was recently renamed Citigroup Global Markets, said it was pleased to have the matter resolved but declined to comment further, the Timessaid.
A Citigroup spokesperson was not immediately available to comment.
The Timesalso reported that the NYSE, in regulatory filings, has said that former Smith Barney Atlanta broker Mr Philip Spartis, who had reported to Grace and oversaw the accounts of many WorldCom employees, gave poor investment advice to clients, among other allegations.
WorldCom has said it planned to change its name to MCI when it emerges from bankruptcy.