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The Consumer Financial Protection Bureau ordered Citibank to pay $3.75 million to consumers and another $2.75 million civil penalty for student loan servicing failures it said led to incorrect late fees and interest charges.
The CFPB also found that Citibank misled borrowers about their tax-deduction benefits, overstated minimum monthly payments and didn't provide required information after refusing to release a co-signer for a loan.
“Citibank’s servicing failures made it more costly and confusing for borrowers trying to pay back their student loans,” said CFPB Director Richard Cordray in a statement. “We are ordering Citibank to fix its servicing problems and provide redress to borrowers who were harmed.”
