Investigation into Citibank continues

19 March 2007

BRUSSELS – Minister for the Economy Marc Verwilghen (Open VLD) will not be bothering Citibank for the moment. The financial institution has been at the centre of controversy recently following claims that it actively seeks out people in deep debt to recruit as customers.

The minister wants to wait until the investigation into the bank has been concluded. “The investigation must be completed before we even consider possible sanctions,” Verwilghen’s spokesperson said.

The inspectorate of the economic affairs department started the investigation into Citibank at the end of 2004. It is looking into whether legislation on consumer credit or trade practices is being violated. If it emerges that Citibank is disregarding the law, Verwilghen can suspend or even revoke the bank’s approval.

Socialist SP.A MP Hans Bonte, who brought the case to public attention, said in De Morgen that he wonders “how effectively the government actually monitors Citibank.” He is pointing the finger at the CBFA, the previous banking commission, and Febelfin, the federation of financial institutions in Belgium.

“In the meetings between the government and the financial sector, the CBFA is not doing enough to protect consumers. And Febelfin is doing nothing to urge large credit issuers like Citibank to self regulate more,” he says.

Both the CBFA and Febelfin dismiss the criticism and claim they are not responsible for the banks’ commercial strategies. “If there are violations, that is a matter for the authorities,” said Marina De Moerlooze of Febelfin.

Subject: Belgian news