In the aftermath of the financial crisis, a handful of Wall Street banks paid a $US10 billion penance for improperly handling mortgage agreements and prematurely or wrongly foreclosing homes around the country.
Now, one of those banks is in trouble again.
Citigroup neglected to compensate about 23,000 people who were eligible for compensation, Bloomberg reported. Regulators have since caught on to the misstep and the bank will pay roughly $US20 million in total to the borrowers who missed out.
Citi and other banks paid the initial compensation package after the Federal Reserve and the Office of the Comptroller of the Currency found the banks had “robo-signed” mortgage papers without looking over each case, Bloomberg reported. That led to hundreds of thousands of inappropriate foreclosures.
The amount compensated to borrowers varies by case, but some of the largest checks went to members of the military who saw their homes foreclosed while they were serving.
Citigroup’s additional payments are expected to go out by the end of the month.