A Newsmakers column item in Monday's Washington Business placed the headquarters of Federated Department Stores in the wrong city. In is in Cincinnati.

Citicorp recently appointed Margaret G. Alton, a 16-year veteran of the New York-based banking giant, to head Citibank Maryland, headquarters for the fledgling Choice credit card operation.

Alton, 39, was business manager of Citicorp's consumer banking in the mid-Atlantic region for the last two years and is credited with the growth of the company's mortgage business in that area. She fills the post of chairman and chief executive officer at a time when important decisions will be made about the company's direction and growth, a company spokesman said.

Citibank Maryland, with a staff of about 700 in its Towson office, currently offers Choice through banks in the mid-Atlantic states, Colorado and Florida.

Alton succeeds Ronald E. Geesey, who helped launch the business in 1980 and solidified Choice's presence in the Washington area with the acquisition of Central Charge from Riggs National Corp. in 1982. Geesey has moved to West Germany to head KKB Bank, Citicorp's banking operation there.

A company spokesman also said that Richard McCrossen, who helped develop the Towson Choice operation and currently heads Citicorp's Visa/Mastercard operation from South Dakota, will oversee development of the Visa/Mastercard East Coast distribution center planned for Hagerstown and eventually will appoint someone to manage it. Citicorp recently got approval from the Maryland legislature to operate as a full-service bank in the state, in exchange for locating its East Coast operations, including about 1,000 jobs, in an old Fairchild Industries plant in Hagerstown. The plant, which is planned only as a distribution and processing center, will be separate from Citibank Maryland.

Citicorp also has appointed John Haggerty, 50, a veteran of the consumer credit card industry, as president and chief operating officer of the Towson operation. Haggerty joined Citicorp in 1980 as senior vice president of Choice after serving as a consultant for Kranzley & Co. and helping to establish the Eastern States Bankcard Association. COMMUNICATIONS

Linda Schraufnagl has been named director of public relations at U.S. News & World Report and The Atlantic magazines, the two magazines owned by Mortimer B. Zuckerman. Schraufnagl, who will be based in U.S. News' Washington headquarters, joined the magazine in 1983 from Newsweek magazine's advertising and special projects development area.

BellSouth has named David O. Williams to the post of director of federal relations in its Washington office. Williams, who will have responsibility for tax and labor issues, has had broad experience on tax matters as a legislative assistant to Sen. David F. Durenberger (R-Minn.), as a tax counsel for Bethlehem Steel Corp. and as an Internal Revenue Service branch chief.

American Satellite Co., a telecommunications partnership between Fairchild Industries Inc. and Continental Telecom Inc., recently appointed James J. Sobczak vice president in charge of its marketing operations. Sobczak's 20-year career has taken him to both Bank of America and the Ford Motor Co. as manager of telecommunications.

Pamela Kostmayer, founder and president of Mothers United To Save Children's Lives (MUSCLE) and a board member of Mothers Against Drunk Driving (MADD), has been appointed public relations vice president of S. W. Morris & Co., a Washington firm specializing in the promotion of social issues. Kostmayer was formerly vice president of John Adams Associates. BANKING, FINANCIAL INSTITUTIONS

Craig W. Anderson, who recently coordinated Continental Federal's $19.6 million conversion from a mutual savings and loan institution to a publicly owned savings bank, has been elected treasurer and chief financial officer. Anderson joined Continental Federal in 1982 as senior vice president and controller.

John M. Brusnighan, in a switch from his 25-year career with the Washington Suburban Sanitary Commission, will become vice president of ASB Capital Management Inc., a subsidiary of American Security Corp., on Aug. 1. Brusnighan has been general manager of WSSC since 1983.

D.C. National Bank has appointed Andrew M. Ockershausen, currently executive vice president and general manager of WMAL Inc., to its board of directors. RETAIL, WHOLESALE TRADE

Entre' Computer Centers Inc., the Vienna franchiser of retail computer centers, has recruited James Gallagher to establish the firm's operations in Australia. Gallagher's experience includes eight years with IBM Corp. as a marketing and sales executive in Australia.

I. Magnin, a division of the St. Louis-based Federated Department Stores, has appointed Martha Slagle operating vice president. Slagle, who began her retailing career with Garfinckel's, will retain her position as general manager of the White Flint store.

Charles H. Sonnenberg, formerly a director of the accounting firm of Deloitte, Haskins & Sells in its Baltimore office, has been appointed senior vice president for information systems at Peoples Drug Stores Inc. He replaces Glen Tarsha, who has been named vice president for special projects. GOVERNMENT

Mary Elsesser has left her post as vice president for legislative affairs for the Virginia Retail Merchants Association to become small business coordinator for the State Economic Development Department. Elsesser will serve as a "liaison between small business and government organizations and advise small business owners of technical and management assistance programs operated in Virginia," officials said.

Charles R. Work, a partner in the law firm of McDermott, Will and Emery and formerly president of the District of Columbia bar, has been appointed to the District of Columbia Commission on Judicial Disabilities and Tenure for a six-year term by President Reagan. He succeeds Vincent Hamilton Cohen. PROFESSIONAL SERVICES

Former Environmental Protection Agency administrator William D. Ruckelshaus will be elected to the board of directors of Insituform of North America Inc. at the board's meeting on Wednesday, the Washington-based pipe-lining manufacturer announced. Ruckelshaus is currently an attorney with the law firm of Perkins & Coie.

The law firm of Squire, Sanders & Dempsey, expanding its practice in the financial services industry, has hired two attorneys who have played "major roles in the restructuring of the banking industry," announced managing partner Thomas J. Quigley. John M. Miller, a former acting chief counsel in the office of the Comptroller of the Currency, and Dennis M. Gingold, previously a staff attorney for the comptroller, will join the firm's Washington office in July. Both are currently partners in the firm of Kirkland & Ellis.

Molly A. Wolfe, president and founder of Knowledgeware Systems Inc. and formerly information programs general manager at Informatics General Corp., has rejoined Herner & Co. as executive vice president and chief executive officer. She was with the Arlington-based information and library systems consulting firm from 1966 to 1973.