Citigroup Settles With U.S. for $7B

    A man walks past a Citibank branch in lower Manhattan, New York October 16, 2012. Citigroup Inc Chief Executive Vikram Pandit resigned abruptly on Tuesday, effective immediately, a shocking change at the top of the No. 3 U.S. bank just one day after a surprisingly strong quarterly earnings report.  REUTERS/Carlo Allegri (UNITED STATES - Tags: BUSINESS) - RTR397EH

    Carlo Allegri/Reuters

    The Justice Department doesn’t settle for chump change. Citigroup has agreed to settle an investigation into the bank’s conduct leading up to the financial crisis for $7 billion. The deal was made after Justice alleged that Citigroup packaged and sold mortgage securities that caused major losses for investors. The agreement includes a record $4 billion cash penalty that will go to the Justice Department, and $2.5 billion pledged to preserve affordable housing and other relief for struggling consumers. The payout went way beyond expectations—Citigroup first offered to settle the case in April for $363 million.

    Read it at The New York Times