Citigroup agreed Wednesday to pay $158.3 million to settle claims that its mortgage unit improperly originated Federal Housing Administration (FHA) loans, a swift reminder that the massive national mortgage deal does not insulate banks from other mortgage-related claims. The settlement of FHA claims comes less than a week after Citigroup joined the four largest mortgage servicers in a $25 billion settlement with state attorneys general and the Department of Justice. That deal covered the banks' abusive mortgage and foreclosure practices collectively known as robo-signing.Citigroup separately on Wednesday agreed to settle the FHA-related claims made in a lawsuit filed by Preet Bharara, the U.S. Attorney for the Southern District of New York, Helen Kanovsky, general counsel for the Department of Housing and Urban Development (HUD), and HUD's Inspector General David A. Montoya.

As part of the settlement, Citigroup "admits, acknowledges, and accepts responsibility" for certain conduct alleged in the complaint, including failing to fully comply with all HUD and FHA requirements "with respect to certain loans," according to a press release from Bharara's office.

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