Citibank Forced to Pay 6.5 Million in Fines for Illegal Student Loan Practices

2828
SHARE

An investigation by the Consumer Financial Protection Bureau (CFPB) has uncovered the company wide use of illegal practises in dealing with student loans at Citibank. This is another damaging blow to the reputation of the banking industry, which took a major hit to its reputation during the housing crash in 2007. It’s disappointing that one of America’s largest financial institutions would be involved in a scheme targeting a group of people already struggling with their finances.

The CFPB found a number of irregularities during their investigation. According to their findings, Citibank had been charging late fees they weren’t entitled to, incorrect interest, they requested monthly payments that were too high, and withheld information about tax deduction benefits. The bank hasn’t had much to say publicly about the situation, but the fact that they are paying the fines without dispute speaks volumes.

Lessons Not Learned

What makes the decision of Citibank executives to allow these illegal practises so surprising is that it appears to be nothing but a policy of corporate greed. The bank was one of the hardest hit by the subprime mortgage crisis and it received one of the largest financial bailouts in American history in 2008 just to keep it afloat. That makes the use of misleading techniques with student borrowers so hard to understand.  Clearly, Citibank didn’t learn the lessons of their past.

1
2
3
4
SHARE
Previous articlePresident Trump Slams Theresa May
Next articleCalifornia on Track to Exceed Renewable Energy Targets
Bay Area Energy
Bay Area Energy makes energy suppliers more responsive to their customers, their communities and the environment. BAE provides consumer choice to PG&E consumers, allowing them to choose suppliers natural gas suppliers that support the consumer’s values. BAE believes you should support energy suppliers who are working to improve our environment, who create fair, opportunities for our young people and who provide clean energy at fair prices.