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Citibank pays $30M for OREO violations

Sioux Falls, SD
10/11/2019
Fine Amount: 
$30 million
Penalty Type: 
Issued by: 

The OCC has announced a $30 million civil money penalty against Citibank, N.A., for violations related to the holding period of other real estate owned (OREO).

The OCC found the bank engaged in repeated violations of the statutory holding period for OREO in 12 U.S.C. § 29 and 12 C.F.R. § 34.82. These violations resulted from the bank’s deficient processes and controls in the identification and monitoring of the OREO holding period. In assessing this civil money penalty, the OCC found the bank failed to meet its commitment to implement corrective actions, resulting in additional violations.

According to the Order:

  • In 2015, the Bank reviewed its OREO processes and portfolio and identified violations of 12 U.S.C. § 29 and 12 C.F.R. § 34.82. These violations resulted from the Bank’s deficient processes and controls in the identification and monitoring of the OREO holding period. Specifically, the Bank lacked adequate policies, procedures, and processes to effectively identify and monitor the holding period for OREO assets. The Bank committed to developing and implementing corrective actions to address these deficiencies.
  • The Bank engaged in repeated violations of the statutory holding period for OREO in 12 U.S.C. § 29 and 12 C.F.R. § 34.82, including over 200 violations alone between April 4, 2017 and August 14, 2019.
  • The bank submitted multiple requests to extend the holding period for OREO assets. These requests were not made timely and resulted in numerous additional violations.
  • Following additional efforts to correct the root cause of the continued OREO holding period violations, the Bank recommitted to implementing corrective actions by August 31, 2018. The Bank failed to meet its commitment, resulting in additional violations of 12 U.S.C. § 29 and 12 C.F.R. § 34.82.

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