Citibank to refund $700 million to credit card customers for unfair and deceptive practices

Today we’re ordering Citibank, N.A. and some of its subsidiaries to refund approximately $700 million to customers for unfair and deceptive credit card practices. This includes unfairly billing consumers for credit card add-on products, deceptively marketing those products, and deceptive collection practices. Citibank has agreed to pay about $700 million in refunds on about 8.8 million accounts.

If you were among the millions of people affected, Citibank should have already notified you or will notify you directly. You do not have to take any action. If you have questions about whether you are entitled to a refund, you can contact Citibank at the number on the back of your credit card. Generally, consumers who were signed up for these products on or after January 1, 2009, will receive full or partial refunds. If you are unsatisfied with Citibank’s response, you can submit a complaint online or by calling us at 855-411-2372.

You might be eligible for a refund if you paid for credit and identity monitoring, credit protection products, or an expedited payment fee.

Credit and identity monitoring products

Nearly 2.2 million consumers who enrolled between 2000 and 2013 have already received or will receive refunds of about $196 million in fees for credit monitoring products (Privacy Guard, DirectAlert, IdentityMonitor, Citi Credit Monitoring Service). If you enrolled in these products, but did not receive all of the services promised, you will receive full refunds for the time you did not receive full services. Most eligible consumers have already received refunds.

Separately, we found that Citibank violated the law when enrolling some IdentityMonitor consumers and when some IdentityMonitor consumers called to try to cancel that product. The amount of refund is determined by a few factors, including whether consumers tried to cancel (even if they were persuaded to keep it), and how long they stayed in the product.

Consumers who enrolled in IdentityMonitor over the phone on or after January 1, 2009, but who did not upgrade to “triple bureau” credit monitoring, will receive full or partial refunds. You are also eligible if you enrolled over the internet between January 1, 2009 and April 1, 2012.

Debt protection products

We found that Citibank violated the law when selling certain debt protection products (AccountCare, Balance Protector, Credit Protection, Credit Protector, and Payment Safeguard) to some consumers. Some of the deceptive practices happened during telemarketing sales calls, while others happened when consumers applied for credit cards at certain retail stores, using “point of sale” terminals or at specialty services desks.

Consumers who enrolled in these products on or after January 1, 2009, will generally receive refunds. Certain consumers are excluded, including if you paid a claim for benefits under the products or if you signed and returned an “Acknowledgment of Membership” form after enrolling.

Certain consumers who enrolled in these products prior to December 31, 2008, may also be eligible for a refund.

Expedited payment fee

Finally, we found Citibank violated the law when they tried to collect overdue payments from some consumers with cards issued by Citibank’s subsidiary, Department Stores National Bank (DSNB). During collection calls, Citibank sometimes charged an “expedited payment fee” of $14.95 without telling the consumer it was charging the fee or misrepresented the purpose of the fee. Nearly 1.8 million consumers who paid an “expedited payment fee” since January 1, 2009 when their DSNB credit card account was delinquent will receive all “expedited payment fees” paid during that time.

Citibank is responsible for providing refunds

Watch out for scammers claiming they will get you a refund. When large numbers of consumers get refunds, scammers sometimes pop up. The scammer may charge you a fee or try to steal your personal information. If someone tries to charge you, tries to get you to disclose your personal information, or asks you to cash a check and send a portion to a third party to “claim your refund,” it’s a scam. Please call us at 855-411-CFPB (2372) to report the scam.

Eligible consumers will get a refund directly, typically by a credit to your account or a check.