Sunday, May 28

Hall of Shame: Citibank to Pay $700 Million in Consumer Relief for Illegal Credit Card Practices

The job of the most honest seller is to sell you, not to give you reasons to buy from a competitor. That over-riding reality drives the free-enterprise system, and places a responsibility on you.

FoolProof's Hall of Shame is here to remind you why a healthy dose of skepticism should rule your decisions before dealing with anyone who wants to touch your money or your general welfare.

July 21, 2015

Credit Cards

"Millions of consumers harmed by bank's deceptive marketing and unfair billing of credit card add-on products and services, and other unlawful practices..."

Source: www.consumerfinance.gov

Citibank was found guilty of:

  • Misrepresenting cost and fees for coverage
  • Misrepresenting benefits of some products
  • Illegal practices in the enrollment process
  • Misrepresenting or omitting information about eligibility for coverage
  • Charged consumers for benefits they did not receive
  • Failed to provide product benefits

The Consumer Financial Protection Bureau's (CFPB) order requires that Citibank:

  • Provide $700 million in relief to roughly 8.8 million consumer accounts
  • Conveniently repay consumers
  • End unfair billing practices
  • Cease engaging in illegal practices
  • Pay a $35 million penalty - Citibank will make a $35 million penalty payment to the CFPB's Civil Penalty Fund