Have you ever sent a credit card payment in, in what you thought was a timely matter only to be charged a late fee? Did you think how can the post office be so slow? You might want to change that thought to how can Citibank and other banks be so evil.
In the my previous diary on Citibank I discussed how Citigroup steals from employees. In this diary I plan to discuss how Citigroup steals from customers through bogus late fees using evidence provided by a former employee. Additionally, I will provide some tips on what you can do and how to fight back.
In fact the number one source of revenue for credit card companies is late fees. (According to http://www.bcsalliance.com). Credit card companies will go to all kinds of extremes to make sure they get you and steal your money even if your payment isn't actually late.
Here is so information and insight from a former employee on how Citibank steals your money through late fees (quotes from employee are in italics:
"When Citi says "if your payment is received by 1pm EST, it will post the same day", they are not fooling around. The supervisor would have everyone pause working so he could set the system date to the next day. This always seemed pretty arbitrary to me. We were working 24 hours, why not let the payments post until midnight or at the end of the bank business day or maybe even between shifts to be less disruptive? It was done manually so it really could be done anytime"(posted at http://www.fuckcitibank.com by a former employee) .
While this is hardly the most damning of evidence it is still dishonest and sketchy to say the least. A lot of people will miss the part that says 1pm.
"And there was always a backlog between envelope to entry anyway. It could take several days for a payment to make that ten foot treck between one semi-automated machine to the next. The batch sorting system also meant a car loan payment could be processed before a credit card payment, even though the credit card payment got there first. They threw away the envelopes so there were no records kept of postmarks. I know following the postmark is too much to ask, but what about the actual date of receipt by Citi. Since things are batch processed it would be no problem to mark batches by the actual date of arrival at the processing center and turn over the machines when the date is really done. Maybe there is some theoretical law of space time they are afraid of violating"(posted at http://www.fuckcitibank.com by a former employee).
So basically, Citibank through a sort of deliberate negligence will receive your payment on time and charge you a late fee anyway. When they receive your payment on time, then cover up the evidence by throwing away the envelope, and then lie and charge you a late fee that is stealing.
"I just thought it sucked that time that they are stretching forward on top of the delay by processing could make the difference between their customers getting slapped with late fees and higher interest rates, when the payment could have been sent in very much on time"(posted at http://www.fuckcitibank.com by a former employee).
This is not the end of it either. In 2001 Citibank settled a lawsuit regarding bogus late fees for 45 million dollars . But as stated from the evidence above written in 2004 they certainly have not changed their evil ways. Instead with a bunch of other banks they have bribed Congress to pass legislation making it much more difficult to bring lawsuits against banks. (a possible topic for another diary-it's just to long and complicated to throw into this one). (Source http://www.bcsalliance.com)
So here are some things that you can do both on a personal and political level:
Send payments in ASAP.
If you are sending a payment close to the deadline, but close enough to make it there on time send it certified mail so you receive proof of the date it arrived.
Always appeal a late fee if you think it is even possible you were on time. When you do this don't call the telephone number, send a letter by certified mail.
Have as few credit cards as possible (limits the number of late fees you get charged).
Pay cash whenever possible.
Second political/advocacy level:
Write to your state attorney general and let them know about illegal practices you are encountering with banks.
Write to Congress and tell them you won't tolerate legislation that allows banks to hurt consumers.
Forward this information to as many people as possible
Email this story to a friend Printer friendly page
Submit News & Views