One of the nation’s largest banks must pay $335 million in restitution for failing to reevaluate and reduce the annual percentage rates (APRs) for approximately 1.75 million consumer credit card accounts, the federal consumer financial protection agency said Friday.
In a release, the Bureau of Consumer Financial Protection (BCFP, formerly known as the CFPB) said it had reached a settlement with Citibank, N.A., for failing to reduce the credit card interest rates in violation of the Truth in Lending Act (TILA), and for “failing to have reasonable written policies and procedures to conduct the APR reevaluations consistent with regulation.”
Under the consent order reached between the agency and the bank, the bank must correct the practices that led to the violations and pay the $335 million in restitution.
However, the bureau pointed out, the consent order does not assess civil money penalties (CMPs) against the bank. No CMPs were assessed, the bureau stated, based on “a number of factors, including that Citibank self-identified and self-reported the violations to the Bureau, and self-initiated remediation to affected consumers.”
As of February, Citibank was listed as the fourth largest bank in the country, with $1.84 trillion in assets. J.P. Morgan Chase, at $2.53 trillion, was ranked largest, according to BankRate.com.