Citibank (NYSE: C) Cancels Exxon-Mobil (NYSE: XOM), Shell, and Conoco-Philips (NYSE: COP) Co-Branded Credit Cards without Warning
Citibank (NYSE: C) recently cancelled hundreds of co-branded MasterCard accounts, primarily cards associated with gas-stations, without notifying their customers.
The Associated Press recently highlighted the story of Shannon Burdette, a Shell Mastercard User that found her credit card was rejected when she tried to refuel her vehicle. After calling the customer service number on the card, she was informed that her account had been closed because of a negative item on her credit report. In the AP’s interview with Burdette, she said “the only negative thing she saw was “closed at credit grantor’s request” on her Shell MasterCard account.
Burdette isn’t the only customer that’s been affected by Citibank’s unannounced account closures. Consumers across the country have reported similar experience and made postings on various consumer websites.
Citibank has confirmed some of the essentials of the story. The bank’s statement said that they had “decided to close a limited number of oil partner co-branded MasterCard accounts.” The statement said that these account closings include credit cards affiliated with Shell, Citgo, ExxonMobil (NYSE: XOM) and Phillips 66-Conoco (NYSE: COP).
These accounts were closed on Wednesday, October 14th, but according to Citibank’s own spokesman, the notices were not sent out until just two days before the accounts were closed. Citibank also declined to state how many credit cards were shut-down and how much credit those cards represented.
Citibank also recently moved to shut down its Home Depot credit cards. Citibank still plans on issuing gas-affiliated credit cards and still is accepting applications for new cardholders, promising rewards such as 1 percent cash back on spending and 3 percent cash back on gas purchases.
Under current regulations, it is perfectly legal for banks to shut-down credit card accounts without notice. Even the Credit CARD Act which is now coming into effect does not address the issue. Typically, credit card companies will maintain the right to shut-down credit lines immediately in the fine print of their agreements.
Citibank did not state why the cards were cancelled, but only issued a statement that the bank “continuously evaluates its products.”
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