The Dow Jones industrial average fell 45 points, or 0.3 percent, to 17,685 as of 11:45 a.m. Eastern time.
Romney negotiated a $10 million federal bailout for his company, but has called for foreclosures to be allowed to “hit bottom” and letting Detroit go bankrupt.
Sale of the warrants gives the holder the right to buy Citigroup common stock at a fixed price.
Officials are warning that the New York City Off-Track Betting Corp. could be forced to shut down in December unless state lawmakers approve a bailout of the operation.
New York-based AIG was one of the hardest hit financial companies by the credit crisis and received the largest bailout the government doled out.
The plan would begin with the Treasury Department converting $49 billion in preferred stock it holds in AIG into common shares, according to the report.
In its single biggest repayment of bailout loans so far, American International Group Inc. said Monday it is paying back nearly $4 billion in taxpayer aid with proceeds from a recent debt sale.