WASHINGTON, June 29 (Reuters) - The U.S. regulator for consumer finance said on Friday it would not penalize Citigroup for overcharging credit card customers provided the bank refunds the 1.75 million borrowers who are due $335 million in refunds.
The Consumer Financial Protection Bureau (CFPB), a leading regulator for Citigroup, said the bank must refund customers but will not have to pay a fine.
Credit card customers who keep up with their payments are often entitled to a lower interest rate and Citibank said a computer error led to 1.75 million customers missing out on a lower rate.
“Citi is pleased to have resolved the matter with the Bureau, and we reiterate our sincere apologies to our customers for not correcting these issues sooner,” the bank said in a prepared statement.
Citi first disclosed the credit card problems in February and promised the to refund $335 million at that time.
The CFPB decided not to penalize the bank since it came forward itself to disclose the error and has promised a fix, the agency said in a statement.
President Donald Trump’s budget chief, Mick Mulvaney, has led the CFPB since November and said the agency has gone too hard after lenders in the past. (Reporting By Patrick Rucker in Washington and David Henry in New York; Editing by David Gregorio)