CitiGroup bought Associates First Capital Corp. late last year and has been dealing with predatory lending issues since. Last week, CitiGroup reportedly suspended business with more than 3,600 subprime mortgage brokers -- far more than previously announced -- as part of continuing internal reforms prompted by last year's acquisition of Associates First Capital Corp. In June CitiGroup was reported to have stopped selling single premium credit insurance on mortgage loans, following a controversy that customers could lose their homes or not build equity on those homes because of the terms of the insurance.

While CitiGroup has been fighting the predatory lending battle, the company reported in July that income from its CitiFinancial unit rose 40% to $286 million from the same period last year. The increase was attributed to substantial cost savings from the Associates integration, as well as a thirteen percent receivables growth and a lower cost of funds. According to the announcement, integration cost savings were running well ahead of targets.

"We are pleased to resolve the North Carolina attorney general's concerns regarding lending practices of the Associates that occurred prior to its acquisition by CitiGroup and before its operations were managed by CitiFinancial," CitiGroup reportedly said in a statement.

email: [email protected]