Unsolicited Credit Cards from Citi
Unrequested cards raise concerns about privacy…
The nation’s largest bank, Citi Bank, has issued 3.5 million department store credit cards to consumers who never requested them– raising privacy concerns and possible threats to identity. Standard MasterCards were sent to Macy customers with accounts that had been inactive for between two and four years as a ‘replacement’. The new cards are not limited to purchases at Macy stores but can be used anywhere MasterCard is accepted.
“In my view, it’s a privacy violation and a customer violation,” says Mari Frank, author of Safeguard Your Identity. “Privacy builds trust. Lack of privacy destroys trust.” In response, Citi spokesman, Samuel Wang, states that customers were notified in advance about the cards and must activate them to begin using them. He also adds that even in case of fraud, customers wouldn’t be liable for the charges. Citi would not say how many of the 3.5 million cards sent out have been activated, only that a favorable number had.
Consumer advocates are concerned with the potential violation of federal law that says that banks cannot issue credit cards unless a consumer makes a request or they’re sent to replace existing cards. “It’s of questionable legality,” says Chi Chi Wu, staff attorney at the National Consumer Law Center. At the least, “it certainly violates the spirit of why the prohibition against unsolicited cards was enacted.”
Joe Ridout, a spokesman for Consumer Action, says they are receiving a growing number of complaints from consumers about unwanted credit cards– and not just from Citi.
* See a complete list of Citi Bank Credit Cards >
March 6th, 2008 at 9:49 am
[…] Although the Federal Truth in Lending Act prohibits companies from sending credit cards to consumers without their request, there are loopholes. “When a company buys another company, they can decide to switch credit card providers or they can renew a credit card list,” said Linda Sherry, director of national priorities for advocacy group Consumer Action. They’re never supposed to send you a card you didn’t request, but they can replace your card with another card.” For instance, when Citigroup acquired the credit service division of Macy’s, they began replacing 3 million dormant Macy credit accounts with Citi Cards. […]