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Citi Expense Accounts Frozen

But top executives will get bonuses after all.

A freeze on bonus payments for Citigroup’s top brass is not the only condition attached to the US government’s $45 billion bailout loan to the troubled bank. The fine print in the agreement, filed with the SEC on New Year’s Eve, reveals the Treasury will keep tight control of all staff expenses so long as the government holds a stake in Citi. The bank has agreed new rules for expenses governing use of the company's private jet, budgets for "entertainment and holiday parties," travel and accommodation, office renovations, the use of contractors, and the purchase or lease of real estate. If the bank wants to make changes to the policy, it must seek permission from the Treasury. But the filing also shows there are gaping loopholes to the ban on staff bonuses that will allow executives to pick up 60 percent of the 2008 bonus pool in stock, stock options, or “deferred cash awards," with the remaining 40 percent "granted subject to performance-based vesting."