Citigroup To Pay $25M To Settle Investors' MBS Suit

Law360, New York (August 27, 2012, 7:47 PM EDT) -- A Citigroup Inc. unit has agreed to pay $25 million to settle an investors' class action alleging that it lied about the quality of mortgage-backed securities it sold, plaintiffs said Monday.

Investors claimed that Citigroup Mortgage Loan Trust Inc., an MBS issuer, lied about the underwriting standards of subprime mortgages that were bundled into securities and sold to investors in December 2006. The cash settlement will resolve the entire lawsuit, according to a memorandum filed in New York federal court.

If all investors who bought the...
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