Citigroup refunds for account sweeping

Renita Jablonski Aug 27, 2008
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Citigroup refunds for account sweeping

Renita Jablonski Aug 27, 2008
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TEXT OF STORY

Stacey Vanek-Smith: The FDIC isn’t the only financial institution in a borrowing mindset. Citigroup is forking over nearly $18 million in refunds and fines for taking money from customers accounts. Marketplace’s Renita Jablonski has more.


Renita Jablonski: Say you overpaid on your Citigroup bill or got a refund for something you bought with your Citigroup card. In some cases, the company would take that positive balance without any notification.

California’s Attorney General investigated the so-called “account sweeping program” for three years. AG Edmund Brown says the company stole from mostly poor people and the recently deceased.

Citigroup is now making refunds to 53,000 customers across the country. The company will also pay $3.5 million in damages and civil penalties to the state of California. Citigroup said in a statement it voluntarily stopped the computerized sweeping practice five years ago.

In Los Angeles, I’m Renita Jablonski for Marketplace.

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