Citigroup to refund $335 million to credit card customers

Friday, June 29, 2018, Vol. 42, No. 26

NEW YORK (AP) — Citigroup is agreeing to refund $335 million to a group of customers who may have been overpaying interest on their credit cards.

In a settlement with the Consumer Financial Protection Bureau, Citi will refund 1.75 million customers in overpaid interest by year-end.

Earlier this year, Citi disclosed that it had used a flawed methodology in determining whether credit card customers were eligible for an interest rate reduction on their cards, as required by the CARD Act, a federal law that governs the credit card industry.

Citi disclosed the flaw to regulators, including the CFPB, in 2017. The CFPB chose not to fine Citi for the flawed practice, citing the bank's choice to self-report the problem to regulators and was in the process of refunding customers.