FILE PHOTO: A man walks by an ATM at the Wells Fargo & Co. bank in downtown Denver, U.S., April 13, 2016. REUTERS/Rick Wilking/File Photo

(Reuters) - Wells Fargo WFC.N has agreed to pay $2.09 billion in penalty to settle claims related to mortgage loans originated in the run-up to the financial crisis.

The civil fine is for alleged origination and sale of residential mortgage loans that the lender knew contained misstated income information and did not meet the quality that Wells Fargo represented, the U.S. Department of Justice said in a statement here on Wednesday.

“Today’s agreement holds Wells Fargo responsible for originating and selling tens of thousands of loans that were packaged into securities and subsequently defaulted,” said Alex Tse, acting U.S. attorney in San Francisco.

The loans in question included subprime and other relatively risky home loans.

“We are pleased to put behind us these legacy issues regarding claims related to residential mortgage-backed securities activities that occurred more than a decade ago,” Wells Fargo CEO Tim Sloan said.

The settlement amount was fully accrued as of June 30, the bank said.

This is the latest blow to the San Francisco-based bank as it tries to recover from a sales scandal that has hurt its results and tarnished its reputation.

In April, the company paid $1 billion in fines to resolve probes into auto insurance and mortgage lending abuses.

Since the sales scandal surfaced about two years ago, the bank has overhauled management and replaced John Stumpf as CEO. It is also running campaigns to regain trust, including an ad saying Wells Fargo was established in 1852 and “re-established” in 2018.