Ten months after Citigroup's $7 billion landmark settlement with the government to resolve a federal investigation into the sale of subprime mortgages, the second report on the bank's progress arrived this week.

In July 2014, Citi acknowledged that, over the course of numerous transactions, the bank put together billions of dollars of mortgage-bond deals with loans it knew were defective, and then misrepresented the quality of those mortgage-bond deals to investors who purchased them. Under terms of the settlement, Citigroup agreed to pay $4 billion in civil monetary penalties to the Justice Department, $500 million in compensatory damages to state attorneys’ general and the FDIC, and the remaining $2.5 billion in the form of relief to aid consumers harmed by its conduct.

Thomas Perrelli, a partner with the law firm Jenner & Block who was appointed as independent monitor, released the first report on Jan. 21, 2014, assessing Citi’s progress toward meeting its obligations by the end of 2018, as the settlement agreement requires.

Details of the second report, discussed below include a status update on the consumer relief credit earned and submitted for the monitor’s  assessment, a description of the outreach events that Citi has conducted thus far, and a brief overview of next steps.

Consumer Relief

As described in Perrelli’s first report, Citi has earned $14 million in consumer relief credit under Menu Item 4A of Annex 2 for the period from April 30, 2014 through Nov. 21, 2014.

Its initial consumer relief efforts was based upon an initial testing population of 100 loans under Menu Item 4A (forgiveness of principal associated with a property where foreclosure is not pursued and liens are released).

For the current quarter, Citi’s Independent Review Group (IRG) has completed its Satisfaction Review, the results of which were submitted to Perrelli on May 14. In the report, Perrelli said he will review and report on these results in the next quarterly report.

“The Monitor and his team are in ongoing and regular discussions with Citi regarding the testing definitions, procedures, and methodologies required to validate credit for consumer relief provided under the Settlement Agreement," the report stated. "The parties, together with the monitor’s consultants and experts, hold weekly meetings and/or calls, and frequently exchange correspondence discussing the relevant issues."

Outreach Requirements

In addition to its consumer relief obligations, Citi must host at least four “Road to Recovery” events each year for the term of the Settlement Agreement 2014 through 2018. The events are intended to ensure that borrowers are informed about their eligibility for relief and have the assistance necessary to apply for such relief.

Citi has set tentative dates for 10 “Road to Recovery” events, to be held from April 2015 through September 2015, currently planned for Los Angeles, Dallas, Miami, Atlanta, Chicago, Washington D.C., Philadelphia, Houston, Detroit, and New York City.

Citi already hosted “Road to Recovery” events in Los Angeles on April 21, and in Miami on May 7. Perrelli said he will provide further compliance reporting on these events in subsequent reports, including reporting on the effectiveness of the events in providing borrowers relief under the Settlement Agreement.

Citi has submitted a claim for consumer relief credit for the second reporting period on May 14. Perrelli’s next report to the public will assess this consumer relief activity and will be issued in the summer of this year.