Annoying Citigroup fact of the day

The bank is jacking up credit card rates as fast as it can, before new rules take effect

By Andrew Leonard
Published July 1, 2009 7:10PM (UTC)
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How the World Works is considering a new regular feature: Enraging Wall Street Fact of the Day.

Here's today's entry, courtesy of the Financial Times:

Citigroup has sharply increased interest rates on up to 15 million U.S. credit card accounts just months before curbs on such rises come into effect, in a move that could fuel political anger at the treatment of consumers by bailed-out banks.

People close to the situation said that Citi, which is about to cede a 34 percent stake to the U.S. government as part of its latest rescue, had upped rates on between 13 million and 15 million credit cards it co-brands with retailers such as Sears.

Citi's rate increases emerged on the day the government proposed legislation to create a new regulator with sweeping powers on consumer protection and a week after the bank was attacked by some politicians for raising employees' salaries.

The rate increases fell mostly on borrowers who failed to pay off their monthly balance in full. Let that be a lesson to us all.

Andrew Leonard

Andrew Leonard is a staff writer at Salon. On Twitter, @koxinga21.

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