Consumer complaint received 2025-11-14 00:00:00
Product: Credit reporting or other personal consumer reports — Credit reporting
Issue: Problem with a company's investigation into an existing problem — Difficulty submitting a dispute or getting information about a dispute over the phone
Company: CITIZENS FINANCIAL GROUP, INC.
State: MA

Complaint narrative:
Formal Complaint to CFPB Complainant : XXXX XXXX Institution : Citizens Bank , N.A. 
Type of Complaint : Fraudulent Loan Inducement / Negligent Underwriting / Failure to Investigate Fraud / Deceptive Lending Practices XXXX  Summary of Complaint Citizens Bank underwrote a {$150000.00} revenue-based loan to my company based on fraudulent financial statements and deposit records provided by XXXX XXXX and XXXX XXXX XXXX former operators of XXXX XXXX XXXX XXXX These records were later judicially confirmed as fraudulent in a Delaware Superior Court default judgment for fraud ( Case No. XXXXXXXX XXXX XXXX ). 
Citizens Bank held and presented these records as accurate, despite their material falsity and connection to systemic Medicare and Medicaid fraud. 
XXXX Key Issues 1. Fraudulent Underwriting Citizens Bank failed to detect or disclose fabricated deposits used to approve the loan. 
2. Failure to Investigate Citizens Bank did not file Suspicious Activity Reports ( SARs ) or conduct due diligence, violating FDIC standards. 
3. Violation of Federal Law o Truth in Lending Act ( TILA ), 15 U.S.C. 1601 et seq.
o 18 U.S.C. 1005 False entries in bank records o 18 U.S.C. 1014 False statements to influence financial institutions o 18 U.S.C. 1344 Bank fraud 4. Pattern of Misconduct Citizens Bank was fined {$9.00} XXXX by the CFPB in XXXX for mishandling fraud complaints. 
XXXX  Legal Authority and Case XXXX XXXX XXXX XXXX, XXXX XXXX XXXX & XXXX XXXX XXXX, XXXX XXXX XXXX ( XXXX. Ch. XXXX ) Fraud can not be contractually disclaimed. 
XXXX XXXX XXXX, XXXX XXXX XXXX XXXX XXXX XXXX, XXXX XXXX XXXX ( XXXX XXXX XXXXXXXX ) Fraud claims survive despite integration clauses. 
XXXX XXXX XXXX XXXX XXXX XXXX XXXX, XXXX XXXX XXXX ( XXXXXXXX XXXX XXXXXXXX ) Fraud claims may proceed with rescissory damages. 
XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX  ( XXXX. Ch. ) Non-recourse clauses can not bar fraud claims. 
XXXX  Legal Remedies Sought Rescission of the Citizens Bank loan or reassignment of liability to XXXX XXXX. 
Referral to FDIC and DOJ for enforcement and criminal review. 
Civil penalties against Citizens Bank for negligent underwriting and failure to comply with federal law. 
Consumer protection assurance that I am not liable for obligations arising from fraudulent inducement. 
Restitution and damages for losses incurred due to Citizens Banks failure to detect fraud. 
XXXX  Supporting Documentation Delaware Superior Court Default Judgment ( XX/XX/XXXX ) Amended Complaint ( XX/XX/XXXX ) Motion for Damages ( XX/XX/XXXXXXXX  ) Evidence of fraudulent financial statements and Citizens Bank account records- Failure to follow XXXX  or XXXX laws in multiple states/ jurisdictions. 
- Citizens Bank fined {$9.00} XXXX over fraud complaints : XXXX XXXX XXXXXXXX - How much interest did Citizens generate off of the loan? 

Legal Summary : Fraud Judgment and Citizens Bank Obligations Federal Statutory Protections Truth in Lending Act ( TILA ), 15 U.S.C. 1601 et seq. : Requires lenders to disclose accurate financial terms and prohibits deceptive lending practices. Regulation Z under TILA protects borrowers from predatory behavior and grants rescission rights for certain loans. 
FDIC Enforcement Framework : Mandates internal controls and enforcement actions against institutions that fail to detect or prevent fraud. Banks must investigate suspicious activity and file Suspicious Activity Reports ( SARs ) when fraud is suspected. 
Case Law Supporting Fraudulent Inducement XXXX XXXX XXXX, XXXX XXXX XXXX XXXX XXXX XXXX XXXX, XXXX XXXX XXXX ( XXXXXXXX XXXX XXXXXXXX ) : Held that a party can not shield itself from liability for fraud through contractual disclaimers. Supports rescission and reassignment of obligations due to fraudulent inducement. 
XXXX XXXX XXXX, XXXX XXXX XXXX XXXX XXXX XXXX, XXXX XXXX XXXX ( XXXXXXXX XXXX XXXX ) : Confirms that misrepresentations in financial statements can support fraud claims and equitable relief. 
XXXX XXXX XXXX XXXX XXXX XXXX XXXX, XXXX XXXX XXXX ( XXXXXXXX XXXX XXXXXXXX ) : Reinforces that Delaware law provides remedies including rescissory damages for contracts induced by fraud. 
XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXXXXXX ( XXXXXXXX XXXX ) : Delaware courts will not enforce survival or non-recourse clauses to bar fraudulent inducement claims. 

Case Law Supporting Fraudulent Inducement and Rescission XXXX. XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX, XXXX XXXX XXXX ( XXXX XXXX XXXXXXXX ) Key Holding : Delaware public policy prohibits parties from insulating themselves from liability for intentional fraud, even if the contract contains disclaimers or caps on damages. 
Relevance : Supports your request for rescission or reassignment of obligations, including the Citizens Bank loan, due to fraudulent financial statements used to induce the transaction. 
Quote : A seller may not contractually limit its liability for intentional misrepresentations made to induce a buyer to enter into a contract.justia XXXX. XXXX XXXX XXXX, XXXX XXXX XXXX XXXX XXXX XXXX, XXXX XXXX XXXX ( XXXXXXXX XXXX XXXXXXXX ) Key Holding : Fraud claims can survive even when a contract contains integration and anti-reliance clauses, if the fraud is within the contract or involves manipulated financial data. 
Relevance : Validates your fraud claims based on false deposit records and manipulated revenue used to secure the Citizens Bank loan. 
Quote : Delaware law does not permit a party to insulate itself from liability for fraudulent misstatements made in a purchase agreement.justia XXXX. XXXX XXXX XXXX XXXX XXXX XXXX XXXX, XXXX XXXX XXXX ( XXXXXXXX XXXX XXXXXXXX ) Key Holding : Fraud claims may proceed alongside breach of contract claims when rescissory damages are sought. Fraudulent SEC filings and misrepresentations gave one bidder an unfair advantage. 
Relevance : Supports your argument that Citizens Banks reliance on fraudulent deposits gave XXXX and XXXX an unfair advantage in securing the loan, and that rescission is appropriate. 
Quote : Plaintiffs request for rescissory damages sufficiently distinguished its fraud claim from its alternatively-pled contract claim.studicata XXXXXXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX ) Key Holding : Delaware courts will not enforce survival or non-recourse clauses to bar fraudulent inducement claims. 
Relevance : Reinforces that contractual disclaimers in the Citizens Bank loan or purchase agreement can not block your fraud claims. 
Quote : Public policy prevents a seller from using survival clauses to eviscerate a claim that the contract itself is an instrument of fraud.mcguirewoods XXXX  Legal Principles from Delaware Fraud Law Material Misrepresentation : Must be about a fact likely to induce reliance. ( See XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX Scienter : Fraud must be intentional or reckless. ( See XXXXXXXX XXXX XXXX XXXX XXXX ) Justifiable Reliance : Buyer must reasonably rely on the false statement. ( See XXXX XXXXXXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX ) Rescissory Damages : Available when fraud makes rescission impractical. ( See XXXX XXXX XXXX XXXX XXXX, XXXX XXXX XXXX ) delawgroup I requested the following from Citizens on XX/XX/XXXXXXXX  and was ignored : XXXX. All KYC documentation collected for XXXX XXXX and XXXX XXXX XXXX, XXXX from XXXX through XX/XX/XXXX, including : Account opening forms- Beneficial ownership disclosures- Source of funds declarations - Business purpose statements XXXX. All XXXX monitoring reports or alerts generated by Citizens Banks internal systems relating to : - XXXX XXXX ( accounts dated XXXXXXXX XXXX XXXXXXXX ) - XXXX XXXX XXXX accounts dated XXXXXXXX XXXX XXXX XXXX XXXX XXXX XXXXXXXX XXXX XXXX XXXX ( accounts dated XXXX XXXX XXXXXXXX ) Any associated accounts ending in XXXX XXXX XXXX XXXX XXXX XXXX XXXXXXXX XXXX. All Suspicious Activity Reports ( SARs ) filed or considered for filing related to the above accounts or individuals. 

4. Internal communications ( emails, memos, meeting notes ) between relationship managers, compliance officers, and the XXXX XXXX XXXX  regarding : - Concerns about fraud - Discussions of account irregularities- Any disclosures made by XXXX XXXX or XXXX XXXX XXXX. Records of all account reviews or audits conducted by Citizens Banks compliance or risk departments for XXXX XXXX XXXX, XXXX or XXXX XXXX. 

6. Copies of all documents reviewed during loan underwriting, including : - Financial statements- Deposit histories - Business plans - Any third-party due diligence reports 7. Policies and procedures in effect from XXXX governing : - XXXX compliance - KYC onboarding - Loan underwriting due diligence- Fraud escalation protocols Additional motions to the court have been submitted and are available

Company response to consumer: Closed with explanation