Citibank assessed $25 million CMP over Fair Housing Act violations; will reimburse $24 million to customers

A civil money penalty (CMP) of $25 million for violating anti-discriminatory requirements of the Fair Housing Act (FHA) was assessed against Citibank, N.A., (Sioux Falls, S.D.) under a consent order executed Tuesday between the bank and the Office of the Comptroller of the Currency (OCC).

The OCC said the bank had certain control weaknesses related to its Relationship Loan Pricing (RLP) program, which was piloted in August 2011 and applied in February 2012 more widely across its customer base. The program was designed to provide eligible mortgage loan customers either a credit to closing costs or an interest rate reduction. From August 2011 to January 2015, the bank did not require its loan officers to inform customers of all discount programs for which they may have been eligible, the order states; in 2014, the bank found that some customers had not received the correct RLP benefit and self-reported its findings to the OCC in 2015.

“As a result of these control weaknesses, some bank borrowers did not receive the RLP benefit for which they were eligible and were adversely affected on the basis of their race, color, national origin, or sex,” OCC said in announcing the order. The agency said based on its findings, it determined the bank violated the FHA and implementing rules.

OCC says the bank has initiated and largely completed a plan to reimburse all customers who did not receive the appropriate RLP benefit, including those customers affected by these violations, and is taking other appropriate corrective action to prevent future violations.

In addition to paying a $25 million CMP, the bank will provide reimbursement to approximately 24,000 customers in the amount of approximately $24 million as a result of the bank’s failures and control weaknesses, the order states.

Office of the Comptroller of the Currency Fines Citibank, N.A. $25 Million for Violating the Fair Housing Act