Citibank Closing Hundreds Of Credit Accounts, Unannounced

[Purveyor]

A business decision by Citibank has some experts scratching their heads. An unknown number of credit card accounts, co-branded with oil companies like Shell and Exxon-Mobil, have been closed by the creditor.

After filling up her gas tank, Shannon Burdette was confused when she was told her card had been rejected. AP reports that she called the customer service line on the back of the card, but was told her account was closed because of something that appeared on her credit report. The only negative statement on her report was the notice of closure by the creditor's request.

Citibank's reason for taking action against customers is unknown. The bank's spokesman declined to give an explanation for the massive closure, according to American Banking News. A statement issued by the bank pointed out that they “continuously evaluate their products.” Estimates for the number of account closures are in the hundreds.

A card being closed has the potential to damage a person's credit rating. If a customer had a high credit limit on their closed account and a high balance in another line of credit, the “utilization ratio” drives the customer's credit rating down, according to John Ulzheimer, president of educational services for Credit.com.

No law, including the recent Credit CARD Act, prohibits banks from closing credit accounts, even if no warning is given.

MORE...

http://rawstory.com/2009/10/citibank-closing-hundreds-credit-accounts-unannounced/

[CaliforniaPeggy]

1. Hm. I have a Shell/Citi card.

I guess the only way to find out if it still works is to try and use it.

I do have other options, though...

They probably have canceled it. I always pay off my balance in full!

:P

[Craftsman]

2. Call them

[CaliforniaPeggy]

4. I could do that...thanks!

[Sebastian Doyle]

3. Wouldn't be surprised if that's who they're targeting

Some of these predatory banks actually use the term "deadbeats" to refer to customers who pay the balance on their card every month, because they obviously don't make any profit that way.

Use credit responsibly and you're a "deadbeat". George Orwell would have been proud of the modern day criminal banking industry.

[CaliforniaPeggy]

5. Yup, they're targeting the "deadbeat" customers!

I think George Orwell would be aghast at what we've accomplished...

Criminal is indeed the word.

:hi:

[shraby]

9. Deadbeats is actually a misnomer...credit card companies

make money on all sales paid for with credit cards because the business accepting the card pays a percentage of the sale to them.

[xchrom]

6. quelle surprise -- the Banksters and Financialists aren't done

driving this country to the bottom.

[wicket]

7. Can they close my student loan account too?

Bastards.

[Pirate Smile]

8. One reason people don't close accounts they don't really use is because it will hurt their credit

ratings. So...are they going to end up damaging people's credit ratings by doing this? I assume yes just based on what I stated. I have an old Citi card I never use, has no balance, etc. I keep it open because it was the first credit card I ever got in my name. I haven't received anything from them but I usually don't get anything because I don't owe anything on it.

[chemp]

10. Me! Me! Me! Me! Me! Me!

I hope so!
My balance is zero, too lazy to cancel it on my own.
My bank/Credit Union offers me a small credit extension if i get overdrawn.

I don't need no ShitiBank! Zombies are so last year.