Oceanografia CEO Said to Post Bail After Citigroup Fraud Arrest

Oceanografia SA Chief Executive Officer Amado Yanez posted bail after his arrest on charges related to a fraud alleged by Citigroup Inc. (C) against his Mexican oil-services company, two people with knowledge of the matter said.

Yanez, 49, posted bail last night of at least 80 million pesos ($6 million), said the people, who declined to comment because the legal process is ongoing. He faces charges that he used loan funds for unapproved purposes, according to an e-mailed statement yesterday from Mexico’s court system.

Citigroup, the third-largest U.S. bank, discovered the bogus loans after learning Feb. 11 that the Mexican government had suspended Oceanografia from bidding on government contracts. After a review, Pemex told the bank on Feb. 20 that it couldn’t verify documents backing $400 million that Banamex had loaned to Ciudad del Carmen-based Oceanografia.

Mexico took control of Oceanografia in February, putting it under the supervision of the Finance Ministry.

Attorney General Jesus Murillo Karam said May 30 that arrest warrants had been issued for people including some who have worked at Banamex, according to a transcript of a press conference in the southeastern city of Merida. He didn’t specify the number of warrants and declined to name people targeted or describe their employment status.

New York-based Citigroup said last month that it terminated 11 people for failing to prevent or discover the alleged fraud.

The Yanez bail posting was previously reported by the Mexican newspaper Reforma.

To contact the reporters on this story: Ben Bain in Mexico City at bbain2@bloomberg.net; Nacha Cattan in Mexico City at ncattan@bloomberg.net

To contact the editors responsible for this story: Brendan Walsh at bwalsh8@bloomberg.net Bradley Keoun, Carlos Manuel Rodriguez

Press spacebar to pause and continue. Press esc to stop.

Bloomberg reserves the right to remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.