Consumer complaint received 2025-05-29 00:00:00
Product: Credit card — General-purpose credit card or charge card
Issue: Trouble using your card — Can't use card to make purchases
Company: CITIBANK, N.A.
State: NY

Complaint narrative:
I write to request the Bureaus urgent intervention into Citibanks policies and automated practices that systematically lock the accounts of customers who verify or register using free VoiceoverIP ( VOIP ) servicesmost notably XXXX XXXX. These account freezes extend to checking and savings accounts, debit and credit cards, and in some cases hold all outgoing ACH and billpayment transactions. The result : customers living paycheck to paycheck, the very segment Citibank professes to serve, are suddenly deprived of access to essential funds and payment tools, with no clear path to rapid resolution.

Factual Background 1. Automated Flagging of Free V
OIP Numbers. Citibanks digitalonboarding and riskmonitoring platforms ( and/or its thirdparty identity providers ) are programmed to identify telephone numbers associated with free VOIP services. Upon detection, the system immediately locks or flags the customers entire suite of accounts, often without notice or human review.

2. No Alternative Verification. Unlike customers with traditional landlines or paid cellular service, VOIP users are given no opportunity to unblock their accounts promptly.

3. Disproportionate Impact on LowIncome Customers. Ma
ny of Citibanks lowestincome accountholders and unbankedtobanked consumers rely on free VOIP services because they lack the resources for a monthly cellular plan. The freeze can last days or weeks, during which customers can not access directdeposit paychecks, pay rent and utilities, or use debit/credit cards for groceries, medicine, or transit.

Legal and Policy Grounds for CFPB Action 1. Unfair, Deceptive, or Abusive Acts or Practices ( UDAAP ).

Unfairness. Under Section 1031 of the DoddFrank Act, an act or practice is unfair if it causes or is likely to cause substantial injury to consumers which is not reasonably avoidable by consumers themselves and not outweighed by countervailing benefits. Citibanks lockouts inflict substantial injury ( loss of access to income and payment methods ), are not reasonably avoidable ( customers can not foresee or prevent a freeze when using a free VOIP number ), and confer no countervailing benefit.

Lack of Transparency. Customers receive generic security hold notices with no clear explanation of why their accounts were locked or what steps will resolve the hold. This omission violates the requirement under 12 C.F.R. 1026.8 ( Credit Card Advertising ) and similar disclosure rules to provide clear, timely explanations of adverse actions.

2. DisparateImpact Discrimination.

While income level is not a protected category under Equal Credit Opportunity Act ( ECOA ), CFPB supervision guidance recognizes that policies tied to credit eligibility or account access that disproportionately burden a vulnerable or underserved population may merit scrutiny. Citibanks VOIP blockade falls squarely on lowincome and newly banked consumersprecisely those CFPB has prioritized for financial inclusion.

3. Violation of Regulation E ( Error Resolution ).

Regulation E ( 12 C.F.R. 1005 ) requires depository institutions to correct errors ( including unauthorized or incorrect electronic fund transfers ) within defined timeframes. By categorically freezing all activity without a clear process for investigation and correction, Citibank is effectively denying customers access to their own funds absent a proper error resolution procedure and timely provisional credit where required.

4. Scope and Scale of the Problem. 
Free VOIP services ( XXXX XXXX, XXXX, XXXX, etc. ) boast tens of millions of subscribers nationwide. Citibank is one of the largest retail banks, serving over 50 million customers. Even if only 2 % of Citibank customers rely on free VOIP, that equates to over one million accountholders exposed to discriminatory hold practices. Anecdotal reports in online forums and communitybased legal aid clinics already describe hundreds of individual complaints. A targeted CFPB inquiry could readily confirm that thousandsif not tens of thousandsof Citibank customers have been wrongly locked out of essential banking services.

Requested Relief 1. Investigate and Enjoin. Immediately launch a supervisory investigation into Citibanks VOIPbased hold policies, riskscoring algorithms, and thirdparty vendor agreements to determine whether these practices violate UDAAP, Regulation E, ECOA guidance, or other consumer protection statutes.

2. Require Remediation. Order Citibank to develop clear, consumerfriendly procedures for verifying VOIP users ( alternate documentation, manual review within 24 hours, provisional credit for blocked payments, etc. ).

3. Data Reporting. Compel Citibank to report the number of account holds triggered by free VOIP verification in the past 24 months, along with average resolution times.

4. Consumer Outreach. Require Citibank to notify affected customers and implement training for frontline staff to handle VOIPbased holds fairly and consistently.

I stand ready to provide further detail or sworn statements. Thank you for your attention to this urgent matter of financial equity and justice.

Company public response: Company has responded to the consumer and the CFPB and chooses not to provide a public response
Company response to consumer: Closed with explanation