Citibank is negotiating with the Swiss government for the payment of up to $50 million in back taxes because of questionable banking activities in connection with international currency trading, bank sources reported yesterday.

Sources said an accountant recently auditing the bank's currency transactions in Zurich found possible violations involving the apparently illegal shifting of profits from the bank's Zurich branch to another bank in Nassau. In compliance with Swiss law, the accountant immediately reported the possible problems to the Swiss authorities, the sources said.

The disclosure came as U.S. banking officials acknowledged to the Washington Post that charges of Citibank improprieties in international money trading "are being taken very seriously." At least four staff members of the Office of the Comptroller of the Currency are working with the Securities and Exchange Commission on a probe of the bank's activities.

The Justice Department and two congressional committees are also in vestigating the bank's money trading activities.

Citibank confirmed that it requested-and has had-a meeting with Swiss banking authorities in an effort to determine just how much money the bank may owe in back taxes.

The spokesman added, however, that the possible liability is "only a fraction" of the $50 million memtioned by other sources. He would not give a figure, however.

The discovery of possible tax violations grew out of an audit of Citibank's money trading operations in seven European countries.

Conducted by Citibank's accountants, Peat, Marwick, Mitchell & Co., and its attorneys, shearman & Sterling, the audit, and the government investigations, came in response to charges from a former bank officer in Paris that the bank was "cooking the books" and transferring profits from European branches to Nassau and other tax havens in an effort to avoid paying income taxes in those European countries.

That former employe, David Edwards, has filed a suit in New York City charging that the bank fired him because he continued to warn the bank of possible violations in its European operations. He has asked for $14 million for what the calls "wrongful dismissal."

The bank has said that it has not approached any other governments in a similar manner.

The bank also continually has denied deliberately breaking any foreign laws.

A spokesman for Peat, Marwick said his firm would have no comment on the audit.