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Citigroup Executives Escaped Criminal Charges for Pre-crisis MBS Sales

As per a government report, the U.S. authorities have decided not to pursue criminal charges against Citigroup executives, who were involved in selling of residential Mortgage-Backed Securities (MBS) during 2008 financial crisis. The U.S. authorities also added that although Citigroup knowingly and purposefully purchased and securitized loans that did not meet representation and warranties, or in many cases were outright fraudulent loans, they did not have enough compelling evidence to pursue charges against executives and other employees.

About 50 subpoenas were issued to Citigroup, trustees, servicers, due diligence providers, and their employees as part of the civil probe. The government investigators reviewed nearly 25 million documents relating to every residential mortgage backed security issued by Citigroup in 2006 and 2007 and interviews were conducted with current and former Citigroup employees and executives. After reviewing the Citigroup evidence, it was determined that there was not enough convincing evidence to continue against individuals connected with the Citigroup investigations.

News Characteristics

Date : Mar 12, 2016
Region : North America
Industry : Banks
Function : Risk Management
Sub-Function : Fraud Management