Oregon Department of Justice

Attorney General Ellen F. Rosenblum

Oregon Department of Justice - Attorney General Ellen F. Rosenblum
submit button to get updates about the Department of Justice
Subscribe to RSS feed   Visit Oregon.gov

Citibank Agrees to Major Reforms In Telemarketing Pitches to Customers

February 28, 2002

Attorney General Hardy Myers today announced the filing of an agreement with the nation's largest credit card issuer requiring the company to make extensive changes in the way products are marketed to its customers by telemarketing firms. Named in an Assurance of Voluntary Compliance filed in Marion County Circuit Court is Citibank (South Dakota) N.A. The AVC, which admits no violation of law, is part of a 27-state settlement that follows a two-year investigation.

Citibank has, for years, contracted with telemarketing firms to sell a variety of products and services to bank customers. In exchange for providing its customer lists, Citibank received a percentage of the sales by these companies.

"The marketing practices of Citibank's business partners were deceptive and misleading and often resulted in consumers being charged for products or services that they didn't know they purchased, " Myers said. "Citibank has an obligation to its customers to ensure that telemarketers do not engage in misleading practices while using its customer lists."

Investigators for the states found that the telemarketers' deceptive marketing often resulted in consumers being charged unfairly for products and services such as discount buying clubs, roadside assistance, credit card loss protection and dental plans. Oftentimes, consumers had no idea that they agreed to purchase anything.

Under the settlement agreement, Citibank is required to include new consumer protection policies in its contracts with telemarketing firms. The reforms will:

  • Prohibit deceptive solicitations
  • Require the bank to review an approve all scripts and marketing materials
  • Require telemarketing firms to comply with consumer protection laws
  • Prohibit customer charges unless there is express authorization of the account holder
  • Require clear and conspicuous disclosure of the identity of the telemarketing company if the script makes reference to the bank.

Citibank has agreed to pay the states $1.6 million, of which Oregon is expected to receive $40,000.

Oregon consumers wanting information on this settlement and general consumer protection topics may call the Attorney General's consumer hotline at (503) 378-4320 (Salem area only), (503) 229-5576 (Portland area only) or toll-free at 1-877-877-9392. Justice is online at www.doj.state.or.us.


Jan Margosian, (503) 947-4333 (media line only) jan.margosian@doj.state.or.us |
email this page print this page check the site map