Business watchdog rules that Citi credit card terms and conditions could have misled consumers on foreign transaction protection.
CitiFinancial Europe (Citi) has been given a dressing down by the Office of Fair Trading (OFT) after it emerged that the company's terms and conditions wrongly stated it did not share joint liability for overseas credit card purchases.
The OFT has issued requirements on the company, under which Citi will have to inform customers who may have been misled of the decision. Consumers who believe they could make a claim against Citi will have to contact the financial services firm.
Citi fell foul of Section 75 of the Consumer Credit Act 1974, which states that credit card providers are both individually and jointly liable with suppliers if the supplier has either misrepresented a transaction or been guilty of a breach of contract.
The OFT investigated Citi's terms and conditions, which state that overseas credit card use is not covered under Section 75. Since March 22nd 2006, Section 75 has applied to transactions made abroad following a Court of Appeal judgement which was later upheld by the House of Lords.
"Section 75 provides important protection for consumers who use their credit cards abroad," said OFT director of credit Ray Watson. "While in practice Citi has been honouring claims for overseas use of its cards, some of its customers may have been misled into not claiming by its stated exclusion of liability for overseas transactions."
Citi has acknowledged the error and has pledged to address the issues raised by the OFT.
