Frequently Asked Questions

 What was this Settlement Agreement about?
The Settlement Agreement resolved civil claims by the federal government and five states alleging that Citi packaged, marketed, and sold defective residential mortgage loans before the 2007–2009 financial crisis.

What did Citi have to do under the Settlement Agreement?
Under the terms of the Settlement Agreement, Citi had to pay a total of $4.5 billion in cash payments and a total of $2.5 billion in consumer relief.

The $4.5 billion was paid as follows:

  • Citi paid $4 billion as a civil penalty to settle claims by the U.S. Department of Justice.
  • Citi paid $208.25 million to settle federal and state securities claims by the Federal Deposit Insurance Corporation.
  • Citi paid $102.7 million to settle claims by the state of California.
  • Citi paid $92 million to settle claims by the state of New York.
  • Citi paid $44 million to settle claims by the state of Illinois.
  • Citi paid $45.7 million to settle claims by the Commonwealth of Massachusetts.
  • Citi paid $7.35 million to settle claims by the state of Delaware.

The $2.5 billion in consumer relief was allowed by the Settlement Agreement to take various forms, including:

  • Loan modifications for “underwater” homeowners (where the amount of the home purchase loan was higher than the market value of the home)
  • Refinancing for homeowners
  • Down payment and closing assistance for refinancing
  • Support for community reinvestment and donations to organizations helping communities in that redevelopment, and
  • Financing of affordable rental housing for low-income families in high-cost areas.

Who was eligible for consumer relief under the Settlement Agreement?
The Settlement Agreement outlines what kind of modifications and activities qualified as consumer relief, but Citi made determinations based on its own credit and loan criteria about which particular loans to modify and what other relief to provide.

Under the Settlement Agreement, Citi was not required to provide relief to any specific consumers. Instead, it had to provide relief to consumers, in the aggregate, that was both sufficient to meet the $2.5 billion commitment it made and consistent with the overall terms of the Settlement Agreement.

What benefits did the Settlement Agreement provide to individual consumers?
To fulfill its commitment, Citi was allowed by the Settlement Agreement to provide consumer relief in various forms, including:

  • Loan modifications for “underwater” homeowners (where the home purchase loan amount was higher than the market value of the home) or other distressed homeowners; such modifications reduced the principal balances owned by the consumers
  • Refinancing for homeowners, and
  • Down payment and closing assistance for refinancing.

THE ROLE OF THE MONITOR

What was the role of the Monitor?
The Monitor’s role was to oversee Citi’s obligation to provide $2.5 billion in consumer relief. This included tracking Citi’s progress, keeping the public informed, and ultimately ensuring that Citi met the requirements outlined in the Settlement Agreement.

Outside of the requirements defined by the Settlement Agreement, the Monitor did not have authority over which forms of consumer relief Citi provided or which consumers received such relief.

The Monitor did not oversee Citi’s obligation to provide $4.5 billion in cash payments, which was directly handled between Citi and the receiving government entities.

How did the Monitor operate?
Mr. Perrelli and his team tested Citi’s activities to determine whether and when Citi fulfilled its consumer relief obligations as required by the Settlement Agreement. As described in the Monitor’s final report, the Monitor concluded that Citi fulfilled those obligations.

Mr. Perrelli was committed to a transparent process and provided the public with thirteen reports containing information that reflected his methodology for testing Citi’s compliance and that offered updates regarding Citi’s progress toward meeting its obligations.

What was the Monitor’s enforcement authority?
Mr. Perrelli was appointed under the Settlement Agreement to act as an independent monitor, and in that capacity to determine whether Citi satisfied its obligations to provide $2.5 billion in consumer relief.

If Mr. Perrelli, as Monitor, had determined that Citi failed to complete its obligations by December 31, 2018, Citi would have been required to pay the difference to NeighborWorks America, a non-profit organization that provides housing counseling, neighborhood stabilization, foreclosure prevention, and other similar programs. However, the Monitor determined that Citi completed its consumer relief obligations by December 31, 2018, making such a payment unnecessary.

How can we be sure that the Monitorship was independent and rigorous?
Mr. Perrelli sought undertake his role as Monitor in an open and transparent way and to foster public confidence in his oversight. Mr. Perrelli reported on his work publicly so that the parties and the public could make their own assessments.

How did the Monitor communicate with the public?
Mr. Perrelli provided updates about Citi’s compliance with the Settlement Agreement through this website, public statements, and meetings with interested parties.