Citigroup has been barred from selling wealth management services to new clients in Indonesia after allegations that a long-time employee stole millions of dollars from customers of its premium retail bank.
The ban was revealed on Wednesday by Darmin Nasution, Indonesia’s central bank governor, who told legislators Citi had been instructed to “temporarily suspend” recruitment of new clients to Citigold, the US bank’s flagship service for wealthy customers.
International banks covet the business of rich Indonesians and much of the wealth management industry in neighbouring Singapore caters to their needs. Citi’s run-in with the Indonesian authorities also highlights some of the risks of the US bank’s global strategy, which is predicated on tapping into fast-growing emerging markets.