Goldman Sachs has agreed to pay more than US$5 billion to settle claims that it misled mortgage bond investors during the financial crisis, Reuters reports. The US Department of Justice said the settlement included compensation for investors who lost money on mortgage backed securities and homeowners who were sold mortgages that exceeded the value of their properties. Italy's banks have come to an agreement with the Government to form a government-backed rescue fund to support banks burdened by high levels of impaired loans, the BBC reports. The Atlante Fund will buy up to €5 billion of equity and bad loans in struggling banks. Italy's banks are carrying €360 billion of impaired loans. Banks that will be included in the scheme include Monte dei Paschi di Siene and Banco Popolare. The Chinese Government is cracking down on the country's shadow banks in an effort to stop illegal capital outflows, the South China Morning Post reports. The Government's position is that illegal money transfers could threaten the country's financial stability and fuel criminal activity. A senior official at the Sate Administration of Foreign Exchange conceded that the regulator had found it difficult to control money flows and promised tighter controls.