According to the Consumer Financial Protection Bureau (CFPB), a major US bank with $222 billion in assets and operations in 14 states, will be paying a fine of $9 million for reportedly engaging in illegal credit card and billing practices.
Citizens Bank neglects customer complaints
Specifically, Citizens Bank neglected to adequately address customer complaints related to credit card disputes and fraudulent claims.
“The bank failed to reasonably investigate and resolve billing error notices and claims of unauthorized use by making customers jump through unnecessary and burdensome hoops, which are not required under the Truth in Lending Act, to report fraud.”
The notes continued and stated the following:
“The bank also failed to fully credit customers’ accounts when unauthorized use and billing errors occurred by sometimes not refunding all finance charges or fees owed to customers.”
According to the Consumer Financial Protection Bureau (CFPB), the Rhode Island-based bank failed to fulfill its obligations to customers who reported billing errors by neglecting to provide them with necessary acknowledgement and denial notices.
Additionally, the bank neglected to disclose mandatory credit counseling information to individuals who dialed its toll-free number designated for that purpose.
CFPB director Rohit Chopra says other banks should be on notice.
“Federal law provides important rights to credit cardholders when disputing transactions and resolving billing errors. As outstanding credit card debt approaches $1 trillion, the CFPB will be closely watching the conduct of the credit card industry.”
The Chair of the Federal Reserve, Jay Powell, has expressed his agency’s vigilance towards financial institutions with significant exposure to the commercial real estate sector.
Speaking at the ECB Forum on Central Banking, Powell acknowledged the concerns surrounding commercial real estate loans and their potential impact on the struggling banking industry.
Powell assured that the Fed is closely monitoring the situation and has identified a considerable concentration of exposure to this sector among regional banks in the United States.
