Posted on: October 23, 2020 | 1 min read

Citigroup Fined over $400M Over Failed Risk Management: Why You Should Leverage Data Governance Before It’s Too Late

Risk Management is an essential part of business operations. Unfortunately, like Citigroup, most businesses realize the importance of risk management when it was too late.

In October 2020, Citigroup, a multinational investment bank and financial services corporation, faced a steep $400 Million fine for poor data governance. According to the New York Times article, a Citi bank employee accidentally wired $900 Million to a lender group to Revlon's beauty products maker. Also, "The [Office of the Comptroller of the Currency] cited the bank's violations of the Fair Housing Act in 2019 and the Flood Disaster Protection Act earlier this year, and attribute both to Citi's inadequate risk management procedures", states the New York Times article.

Like other significant enterprises, Citigroup is reacting to fines instead of proactively avoiding risk when it comes to their data. Risk Management is one of the many features in Data Governance. An effective Data Governance  Framework  evaluates the acquisition, development, use, and disposal of data. For example, data privacy is the practice of ensuring appropriate controls around data to reduce risk significantly.

As a component of data governance, risk management evaluates how data is acquired, organized, prioritized, and distributed within an organization to maximize value and minimize error.

Companies looking to avoid steep fines should implement a streamlined approach to data governance, which considers effective data stewardship, federal policies, legal considerations, and data processes. Businesses aren't always able to stand up data governance and risk management solution in-house either. That's where companies like CCG can support these data governance initiatives and enable businesses to see rapid results.

Learn more about CCG's data governance methodology and framework and empower your business with a proactive risk management approach.

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