News Summary
The Consumer Financial Protection Bureau has ended a consent order against Citibank, which barred discrimination against Armenian American customers. This termination follows Citibank’s payment of over $24.5 million in penalties and efforts to improve practices after allegations of bias in credit applications. Critics are concerned that this action may enable further discrimination, especially amid ongoing class-action litigation against the bank. The decision has drawn scrutiny from lawmakers and local community leaders who highlight the negative impact on Armenian Americans in the Los Angeles area.
Washington, D.C. – The Consumer Financial Protection Bureau (CFPB) has terminated a consent order against Citibank that prohibited the bank from discriminating against Armenian American customers. This decision was made public on Thursday and marks a significant reduction in the enforcement timeline, as the consent order was originally set to expire in November 2026.
The CFPB, under the leadership of Russ Vought, disclosed that Citibank had already paid over $24.5 million in penalties and redress payments. Additionally, the bank has implemented measures aimed at preventing any future occurrences of discriminatory practices. As part of the termination order, allegations of non-compliance by Citibank have been waived.
Citibank entered into the consent order in November 2023 following accusations of using more stringent criteria for credit card applicants whose surnames ended in “ian” or “yan.” The CFPB’s investigation revealed that the bank had targeted Armenian American applicants by associating these surnames with a higher likelihood of fraud. Some employees of Citibank referred to these applicants derogatorily as “Armenian bad guys” or likened them to the “Southern California Armenian Mafia.”
The focus of the CFPB’s investigation was on Citibank’s retail-services division, which has partnerships with major retailers such as Home Depot and Best Buy. Although Citibank did not admit or deny the CFPB’s findings, it has refrained from publicly commenting on the termination of the consent order.
The decision to end the consent agreement has garnered criticism, particularly from California Democratic Senator Adam Schiff. He expressed concern that the CFPB’s action favors large corporations over individuals who experience discrimination in banking services. Furthermore, a class-action lawsuit is currently in progress against Citibank, alleging that the bank denied applications and closed accounts based solely on Armenian-sounding names.
In the Los Angeles area, particularly in Glendale, approximately 15% of the Armenian American population in the United States resides, with around 250,000 individuals living in Los Angeles County. Many members of this community have reported facing negative banking experiences with Citibank, citing instances of discrimination tied to their Armenian heritage. Attorney Tamar Armanak, representing clients who suffered credit card rejections and account closures due to their surnames, has noted a growing demand for action against these practices.
Moreover, the Los Angeles Civil + Human Rights and Equity Department has received numerous complaints from individuals who have encountered unexplained bank account closures and credit denials. Reports have suggested that Citibank also imposed extensive holds on employer checks issued to customers with Armenian names.
The CFPB’s findings indicated that Citibank engaged in practices like falsifying documents to mask discriminatory policies and advised employees against revealing the true reasons for credit denials. The Bureau’s decision to drop the enforcement action follows Citibank’s assertions of having improved its compliance systems to reduce discrimination risks in the future. However, critics argue that the penalties levied against Citibank do not adequately reflect the severity of the wrongdoing.
Citibank has a complicated history of consumer financial violations. Notably, it has previously faced penalties of $335 million for violating the Truth in Lending Act and $750 million for unfair practices in 2015. The current focus on Citibank’s conduct comes at a pivotal time as CEO Jane Fraser is scheduled to testify before Congress as part of an oversight hearing involving major financial institutions.
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Additional Resources
- USA Herald: CFPB Ends Citibank Case Over Alleged Discrimination Against Armenian Applicants
- Los Angeles Times: City Commission Investigating Complaints of Banking Discrimination Against Armenians
- The New York Times: Citigroup Discrimination Against Armenian Americans
- Banking Dive: Citi Fine for Discrimination Against Armenian Americans
- Reuters: Citigroup to Pay $259 Million to Settle U.S. Discrimination Claims
- Wikipedia: Discrimination in Banking
Author: STAFF HERE LOS ANGELES WRITER
The LOS ANGELES STAFF WRITER represents the experienced team at HERELosAngeles.com, your go-to source for actionable local news and information in Los Angeles, Los Angeles County, and beyond, specializing in "news you can use" with coverage of product reviews for personal and business needs, local business directories, politics, real estate trends, neighborhood insights, and state news affecting the area—with deep expertise from years of dedicated reporting and strong community input, including local press releases and business updates, while delivering top reporting on high-value events like the Academy Awards, LA Auto Show, and Los Angeles Marathon, extending coverage to key organizations such as the Los Angeles Area Chamber of Commerce and the Los Angeles Tourism & Convention Board, plus leading businesses in entertainment and technology like Warner Bros. and SpaceX, and as part of the broader HERE network including HEREAnaheim.com , HERECostaMesa.com , HEREHuntingtonBeach.com , and HERESantaAna.com , providing comprehensive, credible insights into Southern California's dynamic landscape. HERE Anaheim HERE Beverly Hills HERE Coronado HERE Costa Mesa HERE Hollywood HERE Huntington Beach HERE Long Beach HERE Los Angeles HERE Mission Viejo HERE San Diego HERE Santa Ana
