WASHINGTON (CBS/AP) — The Justice Department announced a $5 billion settlement with Goldman Sachs over the sale of mortgage-backed securities leading up to the 2008 financial crisis.

The deal announced Monday resolves state and federal probes into the sale of shoddy mortgages before the housing bubble and economic meltdown.

It requires the bank to pay a $2.4 billion civil penalty and an additional $1.8 billion in relief to underwater homeowners and distressed borrowers, along with $875 million in other claims.

The agreement is the latest multi-billion-dollar civil settlement reached with a major bank. Other banks that settled in the last two years include Bank of America, Citigroup and JPMorgan Chase & Co.

Goldman had previously disclosed the settlement in January, but federal officials laid out additional allegations in a statement of facts.

California was one of the states hit hardest by the mortgage crisis. Thousands of homeowners lost their homes.

TM and © Copyright 2016 CBS Radio Inc. and its relevant subsidiaries. CBS RADIO and EYE Logo TM and Copyright 2014 CBS Broadcasting Inc. Used under license. All Rights Reserved. This material may not be published, broadcast, rewritten. The Associated Press contributed to this report.

Comments