The Consumer Financial Protection Bureau said Friday that it had reached a settlement with Citibank over the bank’s overcharging of customers on credit card rates.
The bank will avoid civil penalties, on the grounds that it first reported the problem to the bureau and took steps to remediate it.
Instead, the CFPB required the bank to pay back 1.75 million customers $335 million that they had been overcharged. The bureau had faulted Citibank for failing to reduce customers’ credit card rates in certain circumstances as required by federal regulations.
The bureau’s enforcement actions against banks have become a topic of interest under acting director Mick Mulvaney, a Trump appointee. Mulvaney has sought to curb what he has described as excesses under the previous, Obama-appointed director.
In April, the bureau and the Office of the Comptroller of the Currency exacted $1 billion in fines from Wells Fargo for charging customers for auto insurance they didn’t want.
But otherwise, the pace of enforcement actions under Mulvaney has been slow, although he has said that the agency is processing complaints as normal.
On Thursday, Reuters reported that Mulvaney settled for half the penalty for a payday lender that his predecessor, Obama appointee Richard Cordray, had sought.
Sherrod Brown, the top Democrat on the Senate Banking Committee, criticized the bureau for not imposing fines on Citibank. “When a bank cheats over a million customers out of more than $300 million, there should be a penalty, not an ‘attaboy’ for confessing,” the Ohio senator said in a statement. “The CFPB should be aggressively fighting for consumers, not looking the other way when banks take advantage of customers.”
