Tag: Citibank

Bankruptcy Law, Credit, Debt Relief, Student Loans, Timothy Kingcade Posts

Student Loan Borrowers Awarded $3.75 Million from Citibank

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The Consumer Financial Protection Bureau said in a consent order that Citibank improperly misled borrowers into believing they were ineligible for a tax deduction on interest they paid on certain student loans.  Student loan borrowers who were effected, will share $3.75 million in payments from Citibank for financial practices that forced them to make overpayments, a federal watchdog said this week.

In addition, the bank incorrectly charged late fees and extra interest to borrowers who were still in school and eligible to defer repayments on their student loans.  Citibank also misled borrowers about their monthly bills and failed to disclose required information after the bank denied borrower requests to release loan co-signers.

“Citibank’s servicing failures made it more costly and confusing for borrowers trying to pay back their student loans,” Richard Cordray, the consumer bureau’s director, said in a statement issued with the announcement.

Federal law allows student loan borrowers to deduct as much as $2,500 in annual interest they pay on student loan debt. However, Citibank made statements that suggested the borrowers had not paid qualified interest or were ineligible for the deductions.

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For borrowers who are struggling with student loan debt, relief options are available. Many student loan borrowers are unaware that they have rights and repayment options available to them, such as postponement of loan payments, reduction of payments or even a complete discharge of the debt. It is important you contact an experienced Miami bankruptcy attorney who can advise you of all your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade Garcia McMaken has been helping people from all walks of life build a better tomorrow. Our attorneys help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade Garcia McMaken website at www.miamibankruptcy.com.

Credit, Debt Relief, Timothy Kingcade Posts

Citibank Ordered to Stop Collections on $34 Million in Credit Card Debt, Fined $8 Million

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The Consumer Financial Protection Bureau (CFPB) fined Citibank $8 million last week for allegedly selling credit card debt with inflated interest rates and failing to send consumers’ payments to debt buyers. The credit card giant has also agreed to stop collections on $34 million in credit card debt held by nearly 7,000 consumers.

The CFPB said that Citibank hired two debt collection law firms, Faloni & Associates, LLC, and Solomon & Solomon, P.C., who reportedly altered affidavits filed in New Jersey debt collection lawsuits. Both firms are accused of changing either the dates of the affidavits or the amount owed; in some cases both, after they were executed, which is a violation of the Fair Debt Collection Practices Act.  Citibank claims the agency first learned of violations in 2011 and stopped referring new credit card accounts to it.

In a separate action, the CFPB ordered Citibank to refund $11 million to consumers who were affected by the alleged altered affidavits and nearly $5 million to approximately 2,100 consumers who were affected by the inflated APRs. Citibank has complied and has already issued refunds. Citibank did not admit or deny any of the CFPB’s allegations as part of the enforcement actions.

Fair debt collection practices have been a focus for the CFPB in recent years. Both JPMorgan Chase and American Express have been fined millions for illegal debt collection practices involving credit card debt.

CFPB Director Richard Cordray said in a press release, “Citibank sent inaccurate information to buyers when it sold off credit card debt and it also used law firms that altered court documents. Today’s action provides redress to consumers who were victimized by slipshod practices as part of our ongoing work to fight abuses in the debt collection market.”

If you have any questions on this topic or are in financial crisis and considering filing for bankruptcy, contact an experienced Miami bankruptcy attorney who can advise you of all of your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade & Garcia, P.A. has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade & Garcia website at www.miamibankruptcy.com.

Related Resources:

http://www.foxbusiness.com/features/2016/02/24/citibank-will-stop-collecting-34-million-in-credit-card-debt.html

http://www.americanbanker.com/news/law-regulation/cfpb-fines-citibank-8m-over-debt-collections-1079533-1.html