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Citi closed all our accounts despite having a strong relationship

Citi closed all our accounts despite having a strong relationship

Old Mar 16, 18, 9:39 am
  #1  
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Join Date: May 2009
Posts: 136
Citi closed all our accounts despite having a strong relationship

Its known that Citi frowns on MS but my experience is absolutely incredible.

We have been Citi Gold clients for 30 years with a dozen accounts that total 7 figures. We have a relationship so strong with our branch that we weve been invited to numerous invitation-only events for high net worth clients.

When MS became a hobby a few years ago, we deposited the money orders into our Citi accounts. After maybe 20k of deposits, we received a call from our relationship manager curious about the activity. The manager was fully satisfied with the explanation and entered the explanation into the system. When we asked if it was okay to continue, the manager smiled and gave consent.

So we continued, depositing about $200k/year. 2 years of this activity go by when without warning Citi closes all of our accounts! A dozen checking and money market accounts holding considerable assets.

We appealed up the line, going through the branch manager, the relationship manager (a new person, who, once he joined, we made a point of preemptively discussing our money order activity. So there was another level of awareness!), the local regional manager, and finally the northeast regional manager. Only the northeast manager was interested in helping. So we submitted reams of documents easily demonstrating that no cash or any Citibank cards were involved.

After reviewing the material, he was convinced this was not laundering. It was a legitimate MS activity. But after speaking with Citi compliance, he would still close all our accounts as their compliance department felt uncomfortable with the activity.

We pleaded that

a) citi has been aware of the activity for 2+ years,

b) gave consent to the activity,

c) we would not have continued were it not for the earlier consent by their managers,

d) posed no risk to Citi as no citi cards were involved, and

e) will nevertheless no longer engage in making those deposits.

To a rational person and a rational business, those arguments would be persuasive. But not to Citi.

The decision was a textbook case of an organization managed by bureaucratic principles, where the managers closest to the customer are either not given the discretion in extenuating circumstances to overrule rigid policies or they are fearful of doing so. Having spent a career managing people and departments, I dare say that an overrule here would have been appropriate given the long and profitable customer history. Or at the minimum, provide that customer with a warning and let the profitable relationship continue.

Were done with Citi. And advise everyone to be wary of Citi, whose managers and policies are not, in our view, of the highest caliber.
skiwindham is offline  
Old Mar 16, 18, 10:01 am
  #2  
 
Join Date: Aug 2013
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I'm surprised you are surprised.
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hamokmonky is offline  
Old Mar 16, 18, 10:10 am
  #3  
 
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I don't think that Citi is any different than any other "too large to fail" bank. Once they make a decision, it's made

I have experienced this with Chase several times. They unilaterally closed one credit card and refused to reopen it. On another credit card, they had a rebate which they refused to honor even though the merchant banking part of their operation said that it was a valid rebate ( and eventually refunded me the money out of the branches own operating budget.). I still have a relationship with Chase but in truth do little banking business with them

So the above is again another warning that if you are going to do something that your bank may consider questionable, and you would like to maintain your relationship with that bank, then don't do MS activites with them. Easy peasy.

Finally, with so much in assets, I feel you could get better attention with a smaller bank. I don't think that any will send you packing.
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Old Mar 16, 18, 10:28 am
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Originally Posted by skiwindham View Post
policies are not, in our view, of the highest caliber.
Surely having prudent rules towards questionable activity is the opposite - a well run and reputable institution
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Old Mar 16, 18, 10:44 am
  #5  
 
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You broke the rule: dont s* where you eat.
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Old Mar 16, 18, 11:29 am
  #6  
 
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I feel you, but Citi is just trying to protect it self from the regulators. Even the activities you engage in is not illegal per se, it could look very bad when come audit time.

Unearthing your accounts will trigger a lot of additional reviews by the regulators and will cost Citi more money and time, therefore they really dont want to deal with the headache.

*i have to deal with 3 letter regulatory agencies, not fun.
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Old Mar 16, 18, 12:11 pm
  #7  
 
Join Date: Jan 2011
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Do people normally have a dozen checking accounts??
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Old Mar 16, 18, 12:19 pm
  #8  
 
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Originally Posted by ukyank View Post
Do people normally have a dozen checking accounts??
If you're a Wells Fargo customer, you might have that.
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Old Mar 16, 18, 12:47 pm
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Join Date: Oct 2013
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Unfortunately, big regulated businesses focus almost exclusively on Type I error (saying yes when the answer should be no), rather than Type II error (saying no when the answer should be yes).
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Old Mar 16, 18, 1:19 pm
  #10  
 
Join Date: Nov 2015
Posts: 445
Talking

Originally Posted by skiwindham View Post
Its known that Citi frowns on MS but my experience is absolutely incredible.

We have been Citi Gold clients for 30 years with a dozen accounts that total 7 figures. We have a relationship so strong with our branch that we weve been invited to numerous invitation-only events for high net worth clients.

When MS became a hobby a few years ago, we deposited the money orders into our Citi accounts. After maybe 20k of deposits, we received a call from our relationship manager curious about the activity. The manager was fully satisfied with the explanation and entered the explanation into the system. When we asked if it was okay to continue, the manager smiled and gave consent.

So we continued, depositing about $200k/year. 2 years of this activity go by when without warning Citi closes all of our accounts! A dozen checking and money market accounts holding considerable assets.

We appealed up the line, going through the branch manager, the relationship manager (a new person, who, once he joined, we made a point of preemptively discussing our money order activity. So there was another level of awareness!), the local regional manager, and finally the northeast regional manager. Only the northeast manager was interested in helping. So we submitted reams of documents easily demonstrating that no cash or any Citibank cards were involved.

After reviewing the material, he was convinced this was not laundering. It was a legitimate MS activity. But after speaking with Citi compliance, he would still close all our accounts as their compliance department felt uncomfortable with the activity.

We pleaded that

a) citi has been aware of the activity for 2+ years,

b) gave consent to the activity,

c) we would not have continued were it not for the earlier consent by their managers,

d) posed no risk to Citi as no citi cards were involved, and

e) will nevertheless no longer engage in making those deposits.

To a rational person and a rational business, those arguments would be persuasive. But not to Citi.

The decision was a textbook case of an organization managed by bureaucratic principles, where the managers closest to the customer are either not given the discretion in extenuating circumstances to overrule rigid policies or they are fearful of doing so. Having spent a career managing people and departments, I dare say that an overrule here would have been appropriate given the long and profitable customer history. Or at the minimum, provide that customer with a warning and let the profitable relationship continue.

Were done with Citi. And advise everyone to be wary of Citi, whose managers and policies are not, in our view, of the highest caliber.
City is done with you. They got u first
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kingofkingsforu is offline  
Old Mar 16, 18, 2:04 pm
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The only thing I'm surprised about is it took them 2 years.
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jjmiller69 is offline  
Old Mar 16, 18, 2:05 pm
  #12  
 
Join Date: Apr 2015
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I think a solid rule of thumb is not deposit money orders with your main bank!
alphakenny1 is offline  
Old Mar 16, 18, 2:10 pm
  #13  
 
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Originally Posted by skiwindham View Post
without warning Citi closes all of our accounts! A dozen checking and money market accounts holding considerable assets.

...


Originally Posted by skiwindham View Post
Were done with Citi.
Yup.
jerry305 is offline  
Old Mar 16, 18, 2:19 pm
  #14  
 
Join Date: Jul 2015
Posts: 43
Cool

Originally Posted by skiwindham View Post
Were done with Citi. And advise everyone to be wary of Citi, whose managers and policies are not, in our view, of the highest caliber.
Originally Posted by kingofkingsforu View Post
City is done with you. They got u first
Kind of like say you dumped your girlfriend, because she hasn't called you in a month.
HardDriving_Gman is offline  
Old Mar 16, 18, 3:19 pm
  #15  
 
Join Date: May 2015
Posts: 1,076
Wow, you definitely went through alot after they canned you. I usually open a CFPB out of spite. I'm about to open another one right now with CFPB and also with FINRA since the brokerage part is also involved. Might as well treat them like they treat you
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