Did Citigroup CEO Vikram Pandit quit over whistleblower case payments of $2.22 billion for Mortgage Fraud?

Citigroup Inc. Chief Executive Vikram Pandit resigned suddenly this week effective immediately despite a strong quarterly earning report. Analysts have raised flags about the timing and lack of notice suggesting that Pandit’s departure may signal a dispute at the bank. In addition, his notice comes on the heels this week of the announcement that Citigroup agreed to pay $158.3 million to settle the U.S. civil claims that it defrauded the government into insuring thousands of loans made by its CitiMortgage unit. The settlement related to a whistleblower claim filed under The False Claims Act against the third largest U.S. bank brought by Sherry Hunt, a CitiMortgage employee in Missouri. The government accused Citigroup of falsely certifying that many of its loans qualified for insurance from the Federal Housing agency which is part of the U.S. Department of Housing and Urban Development. Investigators said that 9,636 or more than 30% of the nearly 30,000 loans written by CitiGroup since 2004 have defaulted costing the agency nearly$200 million in insurance claims. The $158.3 million payout is separate from Citigroup’s agreement to pay as much as $2.22 billion under last week’s roughly $25 billion U.S. settlement with five big mortgage servicers over foreclosure abuse allegations. Jeffrey Newman represents whistleblowers. jeffey.newman1@gmail.com