citigroup

Citigroup Fined $8.6 Million By Federal Reserve For Robo-Signing Related Issues

CitigroupThe Federal Reserve leveled an $8.6 million fine against CitiGroup on Friday. The Federal Reserve stated the fine was due to the “deficient execution and notarization of certain mortgage affidavits.

The issue stems from Citigroup’s exit from the mortgage servicing business back in 2017.

The Fed alleges Citigroup mishandled mortgage and notarization documents from January 2015 through August 2015

This type of activity led to the “robo-signing” issue that plagued the foreclosure crisis.

The consent order notes that CitiFinancial states that Lost Note Affidavits affected by the order were replaced with properly executed and notarized affidavits prior to making assertions regarding the ownership of lost mortgage notes.

The bank also states that it has taken steps to address the deficiencies that were the cause of the fine.

Citigroup was under a 2011 consent order from the Federal Reserve while employees were practicing unsafe banking practices.

 ensure the bank took specific steps to address deficiencies related to mortgage servicing.

The company corrected its mistakes by replacing the affidavits potentially impacted by erroneous handling. Citigroup announced the company had successfully exited the servicing business in 2017.

In January of last year, CitiMortgage announced an agreement to a servicing rights deal with New Residential Investment and Nationstar Mortgage that aimed to transfer the servicing rights for approximately 780,000 mortgages away from CitiMortgage.

New Residential paid Citifinancial $97 million for the mortgage servicing rights. Citi also entered into a separate sub-servicing agreement with Cenlar to end its mortgage servicing business.

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