A Citi executive says the bank has no regrets about how it handled customer complaints against its new premium credit card, which were publicized by the Wall Street Journal last week.
Pam Habner, Citi’s head of U.S. branded cards, defended the bank’s actions at American Banker’s Women in Banking conference in New York on Tuesday.
“We feel like we have done the right thing for all of our good customers, and we move on,” Habner told Chana Schoenberger, American Banker’s editor-in-chief.
Citi launched the Strata Elite credit card in July, charging customers $595 per year for a variety of travel, dining and entertainment perks. Those benefits include generous reward points, hundreds of dollars in discounts at hotels, airlines and other businesses, and free access to airport lounges.
Another selling point is the card’s price. Strata Elite, Citi’s first card for high-end customers in four years, offers a lower annual fee than American Express’s Platinum card, which costs $695 per year, and JPMorganChase’s Sapphire Reserve card, which costs $795.
But not all customers have been satisfied. On Oct. 16, the Wall Street Journal published a story describing the complaints of at least three of the card’s users, who said they were locked out of their accounts for weeks and faced multiple hurdles to getting the accounts reactivated.
To unblock their cards, these customers said, Citi required them to submit an I.R.S. form verifying their income. But in at least two cases, the bank allegedly would not let them know whether it had received the document.
One card user, Janice Lintz, said the bank threatened to close all six of her Citi accounts unless it received the I.R.S. form within 30 days. But after repeated calls to customer service, she was unable to confirm that the form had gone through. Ultimately, she chose to cut short a vacation in Bangladesh in order to solve the problem from home.
“Last I checked, there’s no criminal charges against me, no indictment,” Lintz, 62, told the Journal. “So why did I have to fly all the way back from Bangladesh?”
On Tuesday, Habner said the bank did nothing wrong. While the Citi executive said she could not go into detail on the record, she framed the issue generally as a matter of protecting against bad actors.
“We stand behind some of the actions we took to safeguard good customers and to stave off customers that had bad intent,” Habner said.
Overall, Habner said, the launch of Strata Elite has gone “better than we expected,” with demand for the card far exceeding what Citi anticipated.
“When you launch a new product … things happen,” Habner said. “We have to protect the bank, and we have to protect other consumers. And when those customers are treated in a certain way, they can be quite noisy and public about that.”
A Citi spokesperson said in an email: “As is typical with any new product, our fraud prevention operates at a high frequency, and unfortunately this inadvertently affected some of our valued cardmembers. We recognize and regret the inconvenience this caused and took full accountability, and as Pam noted, we are moving on and are pushing forward from this incident to improve our communications with customers. We’ve since identified where adjustments were needed and are actively resolving the issue.”
Habner was No. 22 this year on American Banker’s list of the Most Powerful Women in Banking. Before joining Citi five years ago, she spent close to six years at JPMorganChase, where she launched the bank’s Sapphire Reserve card.
