U.S., SunTrust announce nearly $1B settlement

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WASHINGTON (AP) _ SunTrust has reached a nearly $1 billion settlement with the government to resolve allegations that it underwrote and provided risky mortgage loans. The Justice Department on Tuesday announced the $968 million deal with SunTrust Mortgage, a Virginia-based lender and subsidiary of SunTrust Banks.

U.S. Attorney General Eric Holder said SunTrust’s conduct is a “prime example” of the widespread underwriting failures that helped bring about the recent financial crisis.

As part of the deal, SunTrust has agreed to provide $500 million in homeowner relief and $418 million to resolve allegations that it underwrote bad loans. SunTrust chief executive William Rogers said in a statement that the bank was pleased to have resolved the allegations.

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