Goldman Sachs must pay $5 billion settlement for its mortgage-backed securites before 2008 financial crisis. The bank agreed on Monday to pay the settlement to Justice Department.

Washington Times reported that US Justice Department said Goldman Sachs was misleading its investors to buy securities backed by shaky mortgages in the run-up to the 2008 financial crisis. The settlement required the bank to pay nearly $2.4 billion in civil penalties and $1.8 billion relief to homeowners who are underwater on their loans. The lender must also pay settlement to other states and federal claims at the amount of $875 million.

Acting Associate Attorney General Stuart F. Delery told the press regarding the settlement, "This resolution holds Goldman Sachs accountable for its serious misconduct in falsely assuring investors that securities it sold were backed by sound mortgages, when it knew that they were full of mortgages that were likely to fail."

In 2012, US president Obama established a Residential Mortgage Backed Securities working group to investigate mortgage-backed securities sold by banks. CNBC reported the agreement followed similar settlement with Bank of America, Citigroup and JPMorgan Chase & Co. in the wake of the financial crisis.

White House Press Secretary Josh Earnest welcomed the settlement saying, "I think obviously the president believes that people should be held accountable for their actions, and that's particularly true if there is a situation in which your actions may have been a contributor to the worst economic downturn since the Great Depression."

However expert disagreed the settlement effectively prevent another misconduct by banks. A professor of law and economics at the University of Missouri-Kansas City William Black told CBS News the fine print in the deal effectively insulates Goldman from further civil litigation.

He noted the settlement vaguely mentioned the bank were aware of dodgy mortgages in its possession as a "certain loan pools" to sell to its investors. However it failed to specify which loan pools that contain defective mortgages.

"It is fundamentally more of the same -- no prosecution of the culpable elites, no one fired and no one has their fraudulent proceeds 'clawed back," Black said. "This makes it useless for a plaintiff lawyer bringing a complaint based on particular loan pools."

As a result, Black predicts the settlement will have "zero deterrent effect" on big banks. Professor William Black was a former top financial regulator who helped disclosing frauds and putting hundred of bankers locked up in the 1980s and 1990s.

In the agreed settlement, Goldman Sachs must pay $5 billion settlement over its troubled mortgage-backed securities. The settlement follow similar agreement reached with other firms, but expert said the settlement does not hinder banks to do another financial misconduct.