Legal News

Citigroup Close to Settling U.S. Investigation
Download PDF

citigroup

In order to resolve a probe by the United States government, Citigroup Inc is close to paying $7 billion, according to Reuters. The investigation started on allegations that the bank defrauded investors of billions of dollars worth of mortgage securities as the financial crisis was on the horizon.

Almost all of the settlement will be paid in cash, but the amount includes several billion dollars in help to borrowers who are struggling right now.

  
What
Where


A source close to the situation told Reuters that an announcement of the settlement is expected to be made next week. Wall Street analysts did not expect Citigroup to pay such a large settlement in this probe. The bank was thought to have $3 billion in reserves for a related settlement. Just last month, the U.S. Justice Department asked for $10 billion.

Talks between the Justice Department and Citigroup stalled last month when both sides were far apart on a settlement number. As talks stalled, the Justice Department began to prepare a lawsuit against Citigroup.

Offices for the United States Attorney in Colorado and Brooklyn had been investigating the bank as a larger probe into mortgage securities that were faulty and helped fuel the housing bubble in the mid-2000s.

Get JD Journal in Your Mail

Subscribe to our FREE daily news alerts and get the latest updates on the most happening events in the legal, business, and celebrity world. You also get your daily dose of humor and entertainment!!




In November, JPMorgan Chase & Co paid $13 billion to resolve multiple probes.



 

SEARCH IN ARCHIVE

Most Popular

Legal Career Resources

June 21, 2016 Why the Law Firm Associate Salary Increase Is a Bad Thing

Summary: With the happiness of a bigger paycheck come repercussions for many of the law firms that can’t afford to keep up with the top law firms. Read the Top 10 Reasons Why High Junior Associate Salaries Are Destroying the […]

read more
To Top