A Citigroup unit has reached an agreement with the state of New York to return almost $16 million to more than 31,000 customers across the country that were charged higher advisory fees than they negotiated.
Attorney General Eric T. Schneiderman said in a statement on Thursday that customers with so-called TRAK accounts usually pay an advisory services fee ranging from 1 percent to 5 percent. Since the fees are negotiable, many customers were able to get a lower fee than the standard rate.
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Schneiderman said a Westchester resident had complained to his office about her bank account in 2012, and the complaint was investigated. The investigation found that many Citigroup customers were being charged higher rates than they had negotiated and were not aware that they were paying more than they should have been.
Citigroup Inc. subsidiary Citigroup Global Markets Inc. has cooperated with the Attorney General's investigation. Of the $16 million being returned to customers nationwide, nearly 3,000 New York account holders will receive a total of approximately $1.3 million.
The Attorney General's investigation is continuing in order to determine if there are more customers that were overcharged.
Citigroup Global Markets is performing a wider review of other types of accounts to make sure that any account holders that have been overcharged will also be paid restitution.
The Attorney General's office will continue to oversee Citigroup Global Markets review and remediation efforts.