Citigroup Settles FHFA Lawsuit

Posted by Orb Staff on May 29, 2013 No Comments
Categories : Residential Mortgage

Citigroup Inc. has reportedly settled a lawsuit brought by the Federal Housing Finance Agency (FHFA) for allegedly misleading government-sponsored enterprises Fannie Mae and Freddie Mac into buying $3.5 billion of mortgage-backed securities.

Terms of the settlement were not disclosed. This is the second lawsuit to be settled since the FHFA has accused numerous other Wall Street banks of engaging in similar tactics, according to a Reuters report. The other lawsuits are still pending.

In 2011, the FHFA filed a total of 18 securities fraud cases against banks for selling more than $200 billion in mortgage-backed securities to Fannie and Freddie.

In January, the FHFA settled a separate lawsuit against General Electric Co., accusing the company of misleading Freddie Mac into buying $549 million worth of securities. Terms of that settlement were also confidential.

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