Citi fined $30 million over how it handled foreclosed property

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WASHINGTON — The Office of the Comptroller of the Currency is fining Citigroup's bank subsidiary $30 million over claims that it repeatedly violated federal law for its balance-sheet practices concerning foreclosed property.

In a press release, the OCC said that Citibank had “deficient processes and controls in the identification and monitoring of the [other real estate owned] ... holding period” over the last several years, with violations continuing to crop up as late as August 2019.

“In assessing this civil money penalty, the OCC found the bank failed to meet its commitment to implement corrective actions, resulting in additional violations,” the agency said.

According to court documents filed Wednesday, the OCC first flagged Citibank’s OREO practices in 2015. The bank committed to fixing those violations but subsequently submitted “numerous untimely requests” to extend the holding period for its OREO assets, according to the court filing.

Two years later, the OCC followed up and told Citibank that its “internal controls governing OREO remain decentralized, ineffective, and inadequate,” according to the court filing.

Citibank allegedly committed more than 200 violations between April 2017 and August 2019. However, over the last 12 months, Citibank has “significantly reduced its inventory of OREO assets,” according to the OCC’s court filing.

The OCC will continue to monitor the bank’s progress, the agency said.

In a statement, Citibank said that “in some instances, we did not meet the requirement” of the maximum period for holding onto foreclosed property, which is five years for national banks.

“Since identifying the issue, we have strengthened controls, processes and procedures to ensure the timely disposition of these assets,” Citibank said.

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Enforcement actions Foreclosures Penalties and fines OCC Citigroup
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