Today, the US Department of Justice announced a $7 billion settlement with Citigroup; the financial institution will pay a record-setting $4 billion penalty for misleading investors about securities that included toxic mortgages.
Center for Responsible Lending executive vice president Debbie Goldstein comments on the settlement below. CRL is a nonprofit research and advocacy organization focused on consumer lending. In December 2006, CRL published Losing Ground, the first comprehensive, nationwide review of millions of subprime mortgages and predicted the subprime mortgage crisis that began in 2008.
Goldstein says:
We are gratified that the people and institutions responsible for the 2008 financial crisis are being held responsible for their actions; we applaud the Justice Department as they continue their important work in finding and prosecuting these offenders.
But in the meantime, too many American families are still struggling in the aftermath of the historic housing crisis – too many consumers are still stuck in unaffordable loans, too many families have already lost their homes. As CRL research has shown, the effects of the housing crisis disproportionately impacted the communities most vulnerable to financial shocks – and many are still in the throes of crisis.
CRL looks forward to tracking how this relief will assist consumers and communities hit hardest by the mortgage crisis. Unlike with previous settlements, we hope that the settlement monitor will make detailed data available to the public to ensure that those borrowers and communities impacted by the crisis will receive their just benefits from the relief that is provided.
Contact: Catherine An, 202-349-1878, catherine.an@responsiblelending.org