The government is permitted to sue its citizens. For example, if you owe money in the form of taxes, the IRS can bring both civil and criminal actions against you for unpaid taxes. In every criminal case, the caption of the case is typically "The People of the State of ____ vs. John Doe". Presumably, "John Doe" is one of the "People" of the state.
Therefore, if you owe a balance to Citi, then you necessarily owe a balance to the government and hence, you can be sued. Ultimately, Citi is or should be beholden to you and the rest of the tax-paying citizens of the United States so that as a shareholder, you get a return on your investment. If they do not attempt to recoup their investment in a homeowner to whom they have loaned money, then Citi ostensibly could be sued by any such shareholder.
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