Citi avoids CFPB fine for overcharging cardholders $335 million
On Friday, the CFPB credits Citi for discovering the error and alerting regulators.
Citigroup Inc. got a break from the Consumer Financial Protection Bureau, avoiding a fine after failing to adjust rates for cardholders and costing them more than $335 million.
The agency, which is being reshaped under President Donald Trump, announced the decision Friday. It credited the lender for discovering the error, alerting regulators and setting out to repay borrowers before being ordered to do so. The lapses affected about 1.75 million accounts, according to a settlement posted on the CFPB’s website.
The deal contrasts with the $1 billion in penalties the CFPB and Office of the Comptroller of the Currency imposed on Wells Fargo & Co. in April for allegedly forcing unwanted insurance on customers who took out car loans and imposing inappropriate charges to lock in mortgage rates. The case built on a pattern of consumer abuses at the bank, which has vowed to root out problems and make customers whole.
The decision to refrain from fining Citigroup didn’t go unnoticed on Capitol Hill.
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