Washington State

Office of the Attorney General

Attorney General

Bob Ferguson


OLYMPIA- 2/27/02 - An agreement between Citibank and several states, including Washington, will result in new restrictions on the use of personal financial information that the bank shares with direct marketers, Attorney General Christine Gregoire announced today.

The agreement-signed by representatives of Citibank, Washington, 26 other states and Puerto Rico -is the latest in a series of efforts by state attorneys general to control how telemarketing and other direct sales firms use credit-card numbers and other personal information obtained from financial institutions, Gregoire said.

"Consumers should be able to trust that their personal financial information will be handled as carefully as their savings deposits," Gregoire said. "Citibank has accepted responsibility for the marketing practices of the businesses it shares information with. Hopefully, other financial institutions will follow Citibank's lead."

Information sharing by banks has led to consumer complaints about the appearance of unauthorized charges on their credit cards. In those cases, consumers complained they were unaware telemarketers had their financial information.

The agreement with Citibank spells out conditions it will impose on businesses with whom it shares customer information. The conditions require:

  • Bank review and approval of all marketing materials;
  • Compliance with all consumer protection laws by telemarketers;
  • Clear approval by cardholders prior to any charges.

The agreement also bans deceptive marketing and, if telemarketers mention the bank during a sales call, they must clearly state they are not affiliated with the bank.

The Citibank agreement follows similar agreements with two other firms. Those agreements also were intended to curb the improper use of personal financial information shared by financial institutions.

In August 2000, the state settled a case with the Connecticut-based telemarketing firm BrandDirect, which had obtained consumer information from several major financial institutions, including Citibank. Consumers complained that unauthorized purchases were sometimes billed to their credit cards.

In the settlement of that case, BrandDirect agreed to pay $11 million in restitution to as many 2.7 million people, 30,000 of whom live in Washington.

In September 2000, Washington joined other states in settling a lawsuit against US Bank over the bank's policy of sharing credit-card information with marketers. Among other things, US Bank agreed to give consumers the option of prohibiting the bank from sharing personal information with third parties.

The latest agreement with Citibank is a significant step toward ensuring that banks exercise control over how information they provide to marketers is used, Gregoire said.

Under the terms of the agreement, filed today in Thurston County Superior Court, Citibank agreed to pay the states $1.6 million to cover their legal costs. The four lead states in the case each will receive $170,000. The remainder will be split among all but one of the remaining states and Puerto Rico, with $40,000 going to Washington.