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October 31, 2016

Citi Enlarges the Fine Print, But a Clever Ploy Lurks Within

Filed under: Finance — Edgar (aka MrConsumer) @ 6:09 am

We all periodically receive a “card agreement” from credit card issuers. It is usually a small, sixteen panel, accordion-pleated booklet full of fine print about how finance charges are calculated, how fees and payments will be applied, etc.

Citi card agreement

Citi, however, has seen the light. They just sent out a new and improved version on 8-1/2 by 11 paper, divided into numbered sections, printed using a decent size font, and written in relatively plain English.

new agreement

The new document is 15 pages long, however, which probably won’t encourage too many people to sit down and read it.

One big change in terms is Citi’s mandatory arbitration provision. They have heard regulators and advocates complain about these legal provisions that prohibit cardholders from going to court or participating in a class action lawsuit against the card issuer. Citi is giving their customers a one-time chance to opt-out of arbitration.

(Larger than usual) *MOUSE PRINT:

arbitration provision

You only have until December 22 to notify Citi that you want out of arbitration. But lest we think that Citi has completely become pro-consumer, they required you sent them a physical letter with your request to opt-out. You cannot call (we tried) and you cannot email. You have to write a real letter (remember them) and put a stamp on the envelope.

Citi has certainly taken an approach to assure that the fewest possible cardholders will take advantage of this one-time offer. At least they didn’t require the request to be notarized and sent via certified mail.

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10 Comments

  1. Citi is following the format of rebate redemption: High hurdles reduce the number of finishers. And the United States Postal Service thanks you.

    Comment by Marty — October 31, 2016 @ 8:04 am
  2. And here I was thinking that Citi was in a good mood by raising my credit limit. Perhaps they were just trying to distract me from opting out of arbitration.

    Comment by Wayne — October 31, 2016 @ 9:12 am
  3. “At least they didnt require the request to be notarized and sent via certified mail.”

    Shhh, you’ll give them ideas!

    Comment by cmadler — October 31, 2016 @ 9:23 am
  4. I’d be interested to see a study down the road, say the people that opt out, do they get their cards cancelled or perhaps higher interest rates or lower credit limits?

    Comment by Lisa — October 31, 2016 @ 11:37 am
  5. Just wait until a Citi customer who has sent in the opt out letter tries to avoid arbitration. Citi won’t be able to find it.

    A Certificate of mailing or using certified mail might not be such a bad idea.

    Comment by Howard — October 31, 2016 @ 12:31 pm
  6. If they want it in writing, will they accept a FAX ? (remember them?)

    Edgar replies: Good question! They certainly do not provide a fax number in the notice, however.

    Comment by MoeJerri C — October 31, 2016 @ 2:19 pm
  7. I doubt Citi will target those who opt out for card cancellation. They don’t really care if you opt out. The main goal of arbitration provisions is to stop class action lawsuits. Having the arbitration provision take effect on inaction is enough to do that regardless of how many people opt out of it.

    Comment by Marc K — October 31, 2016 @ 9:42 pm
  8. I wrote a letter, following all their instructions, and got 2 responses, one stating I am opted out and the other saying I was not eligible for opt out. Upon calling customer service several times, they said they would get it to the right department , look into it, and call me back. It is 6 weeks since the last request and am still waiting. I still don’t know if they are honoring the opt out or not.

    Comment by Carol Blacher — October 31, 2016 @ 11:16 pm
  9. You know the world still spins and every day life continues WITHOUT a credit card.

    Comment by Gert — November 1, 2016 @ 3:12 pm
  10. Gert: You know the world still spins and every day life continues WITHOUT a credit card.

    Yeah, but it suddenly stops spinning if you don’t have a CC and you have to rent a car or get a motel room.

    For what it’s worth, this whole pre-dispute mandatory arbitration agreement scam was the brain-child of USSCt Chief Justice John Roberts. As long as you’re writing letters, write to your federal and state legislators and demand consumer protection laws that make pre-dispute arbitration agreements null and void.

    Comment by Denis O'Brien — November 15, 2016 @ 8:29 am

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