Citi ordered to pay $770 million over credit card practices
By Richa Naidu
(Reuters) - Citigroup Inc's consumer bank has been ordered to pay $700 million in relief to borrowers for illegal credit card practices, the U.S. Consumer Financial Protection Bureau said.
The CFPB, set up under the 2010 Dodd-Frank Act aimed at reforming Wall Street, has been cracking down in recent years on credit card companies offering payment protection, credit score tracking and other add-on products.
Citi will also pay civil penalties of $35 million each to the consumer finance watchdog and the Office of the Comptroller of the Currency.
The settlement is the CFPB's tenth such case, Director Richard Cordray said in a statement on Tuesday.
"They (the CFPB) are just marching through the industry," FBR & Co financial policy analyst Edward Mills told Reuters.
"The CFPB loves to have big numbers like this, especially when the largest percentage of the fine goes back to customers because there's a lot of (political) push-back about the cost of the CFPB and the way they're funded."
Other major U.S. banks under that have been fined over credit card misconduct include JPMorgan Chase & Co and Bank of America Corp.