Citigroup defends $75 million settlement over mortgage disclosure as fair, adequate

Citigroup defends $75M settlement

WASHINGTON — Citigroup Inc. is defending as fair and in the public interest its $75 million civil settlement with the government over charges it misled investors about billions in potential losses from subprime mortgages.

The third-largest U.S. bank made its arguments Monday in a filing to a federal judge in Washington. The judge said last month she was “baffled” by the proposed settlement and wasn’t ready to approve it without more information. Citigroup said the $75 million penalty is “fair, reasonable, adequate and in the public interest.”

The Securities and Exchange Commission defended the settlement on the same grounds in its own filing last week. The agency had accused Citigroup of repeatedly making misleading statements in calls with analysts and regulatory filings about the extent of its holdings tied to high-risk mortgages. Citigroup had said the exposure was $13 billion or less; the SEC said it exceeded $50 billion.