Citigroup fired top Internet analyst Mark Mahaney and paid a $2 million fine to a Massachusetts regulator to settle charges that the bank improperly disclosed research on Facebook's IPO and information on other tech companies.
William Galvin, Massachusetts' top securities regulator, is also probing other Wall Street banks involved in Facebook Inc.'s initial public offering, including lead underwriter Morgan Stanley, Goldman Sachs and JPMorgan Chase.
The ouster of Mahaney, a blow to Citi's technology business, came after Galvin's office charged Citigroup Global Markets Inc. with breaking state securities laws governing disclosure of broker research. The bank said it also dismissed a junior analyst Mahaney had supervised.
The complaint contends the unidentified junior analyst sent some of Citi's confidential views on investment risks and revenue estimates for Facebook to two employees at TechCrunch.com, a technology-focused media company, three weeks before Facebook went public on May 18.
Mahaney failed to supervise this junior analyst, according to the Massachusetts complaint. It said Mahaney also had improperly passed on his views about Google Inc to a reporter at Capital Magazine, a French publication.
Citi said it was pleased that the matter was resolved. -- Reuters