CitiFinancial has reached a $1.25 million settlement with 35 state regulators for violating federal mortgage disclosure rules.

Regulators and the mortgage company acknowledged that the violation stemmed from a computer programming error.

The settlement, announced Wednesday, is the most coordinated enforcement action by state regulators since they formed a committee in 2008 to supervise mortgage companies operating across state lines. Industry observers and regulators say this demonstrates a move toward collaboration on investigations and enforcement.

Larry Platt, a partner in the financial services group at K&L Gates LLC in Washington, said he views the settlement as more symbolic than substantive.

"The dollars aren't great; the violation is not a bad act," Platt said. "So it's really just a signal to state-regulated entities that state governments are prepared to work in concert to ensure compliance with consumer credit laws."

During an exam last year, Massachusetts regulators discovered that CitiFinancial failed to report data under the Home Mortgage Disclosure Act, which helps examiners flag potentially discriminatory lending patterns.

The regulators contacted the Multi-State Mortgage Committee. Within 72 hours, 35 states had agreed to cooperate, said Chuck Cross, the vice president of mortgage regulatory policy at the Conference of State Bank Supervisors, which facilitates the committee.

Regulators said the company failed to report 91,127 residential mortgage loans — nearly 11% of its residential mortgages — between 2004 and 2007.

Federal law requires lenders to disclose the loan amount; location of the property; race, gender and ethnicity of the borrower; and whether or not the application was approved.

The fine is the largest related to a violation of the HMDA, regulators said. As part of the agreement, CitiFinancial has submitted the missing data to the Federal Reserve. It also has agreed to hire an independent consultant to review the data and internal controls to ensure information is properly reported in the future.

The only other multistate settlement of this kind was signed in July by 14 states, Cross said.

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