U.S. bank regulator fines Citigroup $25 million for violating fair lending rules

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WASHINGTON (Reuters) - The U.S. Office of the Comptroller of the Currency (OCC) said on Tuesday it had fined Citigroup $25 million for violating the Fair Housing Act by denying some borrowers preferential rates on the basis of their race, color or other factors.

In 2012, Citi implemented a program that provided reduced pricing for mortgage borrowers that kept certain levels of assets with the bank, typically referred to as relationship pricing. The bank later identified some errors with the program which resulted in some mortgage customers failing to receive the benefit for which they were eligible, the OCC said.

The errors affected borrowers across gender, race and ethnicity, in violation of the Fair Housing Act, the OCC found. Reuters previously reported that the OCC had been investigating Citi over the problem and initially decided to issue the bank with a written reprimand.

“Citi has no tolerance for discrimination in any form,” the bank said in a statement.

“Citi self-reported the issue to the appropriate regulators, conducted a comprehensive review, strengthened processes and controls to help ensure correct implementation going forward and has largely completed reimbursements to the identified customers.”

Reporting by Michelle Price; Editing by Tom Brown