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July 15, 2014

Citigroup to Pay $7 Billion for "Egregious" Sale of Toxic Mortgages 
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Citigroup has agreed to pay $7 billion to settle a federal probe over
its sale of toxic mortgage-backed securities that helped sink the
economy and displace millions of people. The deal includes $2.5 billion
in relief for those who lost their homes. At a news conference Monday,
Attorney General Eric Holder said Citigroup purposefully hid the risks
it knew were associated with the loans.

Eric Holder: "The bank's misconduct was egregious, and under the terms
of the settlement, the bank has admitted to its misdeeds in great
detail. The bank's activities shattered lives and livelihoods throughout
the country and also around the world."

Holder said the settlement includes a civil penalty of $4 billion, the
largest penalty to date of its kind. But in a statement, the group
Public Citizen called the deal "too lenient," noting no criminal charges
have been announced.

 

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