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The Consumer Financial Protection Bureau has ordered Citibank to pay $700 million to consumers who were affected by “unfair and deceptive” practices used in selling credit card add-on services, deceptive marketing and unfair billing practices between 2000 and 2013, the CFPB announced today. Eligible customers will be notified and receive refunds, Citi said in a statement. Citi must also pay fines to the CFPB and the Office of the Comptroller of the Currency totaling $70 million.

Citibank marketed credit- and debt-protection products while misrepresenting the fees, costs and benefits of some of those products, according to the CFPB. The consumer watchdog said the subsidiaries Department Stores National Bank and Citicorp Credit Services, Inc., also illegally enrolled customers in these products by using leading questions to get consumers to authorize billing for some products or taking ambiguous answers as permission to bill for some products.

Products named in the agreement include the following: AccountCare, Balance Protector, Credit Protection, Credit Protector, Payment Safeguard, IdentityMonitor, DirectAlert, PrivacyGuard and Citi Credit Monitoring Services. In some cases, customers were charged for services they did not receive, or they were under the impression they were receiving benefits that were not included in the add-on products.

“Citi cooperated fully with the CFPB and OCC and has taken extensive steps to address each issue that affected customers. Citi previously discontinued sales of the products included in the agreements, which include credit monitoring and debt protection products and wallet protection services, and no longer charges expedited pay-by-phone fees,” the statement from Citi says. A company spokeswoman highlighted the fact that Citi discovered and disclosed these practices during a regulatory review of billing and marketing practices, and customers have been receiving refunds since 2013.

Citi will automatically credit affected customers’ accounts or send a check, and those eligible for refunds who are no longer Citi customers will be mailed a check. Here’s how the refunds break down, according to the CFPB:

  • $479 million to about 4.8 million consumer accounts affected by deceptive marketing or retention practices;
  • $196 million to about 2.2 million consumer accounts enrolled in and charged for credit monitoring products while Citibank did not perform all of the promised services;
  • $23.8 million from Department Stores National Bank to about 1.8 million consumer accounts for charging expedited payment fees on delinquent accounts.

This agreement is a reminder to consumers to closely review account activity for fees or charges you don’t recognize or understand. Even if the charge is legitimate, it doesn’t hurt to call your bank and ask for an explanation when you’ve been caught off-guard, and you never know what you might be able to get changed if you ask. Additionally, regularly checking your account activity helps you spot fraud, which can damage your credit score (and cost you a lot of money) if it goes on for a long time. To help monitor your accounts for unauthorized activity, it helps to frequently get a free credit report summary — you can do that for free every 30 days on Credit.com.

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