Citibank is a large credit card company. Depending on the nature of the claim, there are different defenses you might consider. Here are some general considerations:
1. Truth in Lending Violations
Many banks were close to collapse in the real estate collapse of 2008, and the government stepped in to help. See Too Big to Fail.
Many became aware that when the banks became solvent they readily raised interest rates on many accounts. A new law required a reevaluation and documentation of that which Citibank violated.
If you have an older account where the interest rate was raised, Citibank may have improperly failed to reevaluate the account, and therefore the amount in the account is incorrect.
“The Bureau of Consumer Financial Protection (Bureau) has reviewed the credit card account management activities of Citibank, N.A. (Respondent, as defined below) and has identified the following law violations: (1) violations of the Truth in Lending Act (TILA), as implemented in Regulation Z, by failing to reevaluate and reduce the annual percentage rates (APRs) for certain consumer credit card accounts consistent with the requirements of section 1026.59(a) of Regulation Z; and (2) violations of TILA, as implemented in Regulation Z, by failing to have reasonable written policies and procedures in place to conduct the APR reevaluations consistent with the requirements of section 1026.59(b) of Regulation Z. Under sections 1053 and 1055 of the Consumer Financial Protection Act of 2010 (CFPA), 12 U.S.C. §§ 5563, 5565, the Bureau issues this Consent Order (Consent Order).”
2. Document Hardship and Seek Payment Arrangements
If you had unexpected problems like a loss of job or illness, you may be entitled to relief. Document the problems. Maintain open and clear communication with Citibank. Explain your side of the story and provide any supporting evidence. They may be willing to work with you to find a resolution.
Legal Advice: If the claim is significant and you’re facing legal action, consider seeking legal advice. A lawyer can help you understand your rights and provide guidance on the best course of action.
3. Request Arbitration
While credit card companies like to proceed quickly to court and obtain judgments, there are alternatives like arbitration. To prevent class actions companies offer individual arbitration which may enable you to have your claim individually assessed.
4. File Papers and Confirm Arrangements
Companies like to obtain easy judgments and then enforce them. Arrange to file an answer and if payment arrangements are made, confirm no judgment will be entered.
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Credit Card Defense 