Deutsche Bank finalized a $7.2 billion settlement with the Department of Justice after selling misleading mortgage-backed securities before the market crash of 2008, CNN reported.
On Tuesday, the DOJ said that the settlement—which was announced in December—is the largest levy of its type to be finalized by the department.
“Deutsche Bank did not merely mislead investors: It contributed directly to an international financial crisis,” Attorney General Loretta Lynch said.
“Our conduct in this matter falls short of our standards and is unacceptable,” said Deutsche Bank CEO John Cryan. “We apologize unreservedly for it. We have subsequently exited many of the underlying activities and comprehensively improved our standards.”
After the 2008 financial crisis, the DOJ has conducted investigations on banks practicing with unscrupulous business tactics. Deutsche Bank and many of its competitors were found to have packaged poor-quality mortgage bonds into securities to make them seem like reliable investments.
The settlement includes a $3.1 billion civil penalty with the other $4.1 billion set aside for “relief to underwater homeowners, distressed borrowers and affected communities,” according to a DOJ statement.
Measures to support people affected by the bad investments include issuing loan forgiveness and forbearance as well as providing funding for affordable housing in the U.S., to be overseen by an independent agency.
Since the DOJ investigations began in 2008, the DOJ has levied over $60 billion in fines regarding the faulty mortgages.
Other banks fined for these practices include JP Morgan, $13 million; Bank of America, $16.7 million; Goldman Sachs, $5.1 billion; and Citigroup, $7 billion.
