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Citigroup Settles Allegations of Credit Card Skimming

By Admin on August 27, 2008 | Last updated on March 21, 2019

Citigroup Inc. has reached an agreement with California Attorney General Edmund G. Brown, Jr. to settle allegations that the company engaged in the illegal practice of "sweeping" positive balances from Citibank customers' credit card accounts. Under the settlement agreement, Citigroup will pay out more than $18 million in customer refunds and civil penalties.

A News Release from the California Office of the Attorney General states that Citigroup's practices netted the company more than $14 million from over 53,000 customers nationwide. Using a computerized "account sweeping" program, Citibank customers' positive credit card balances were allegedly funneled from customer accounts into the bank's general fund. Under terms of the settlement, Citibank will refund all "swept" funds to affected customers nationwide, and will pay $3.5M a civil penalty to the State of California.

According to, Citigroup Inc. "takes issue" with the California Attorney General's characterization of the company's conduct and the state's allegations of foul play.

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