Citigroup admits mortgage fraud in $158-million settlement

latimes.com/business/la-fi-citi-settlement-20120216,0,2857186.story

Citigroup Inc. is paying $158 million to settle accusations that it took advantage of a federal mortgage insurance program.

In a settlement with the Justice Department, Citi admitted that it provided misleading information about the quality of its mortgages to a federal insurance program run by the Department of Housing and Urban Development. The government provided backing for the mortgages and ended up losing millions when the borrowers defaulted.

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