Judge dismisses discrimination claim against Citibank over excused ATM fees
In a recent ruling, Judge Raag Singhal dismissed a lawsuit against Citigroup (Citi) that accused the bank of unlawfully granting fee waivers to people using out-of-network ATMs if their accounts were held at nonwhite-owned banks. The plaintiffs, who bank with Citi competitors JPMorgan Chase and Bank of America, called Citi's program discriminatory.
However, the judge determined that the plaintiffs lacked standing in the lawsuit, as entry into Citi's ATM program requires a contractual agreement between Citi and a financial institution, not an individual customer. The judge also noted that the plaintiffs' harm, due to paying out-of-network fees to use Citi's ATMs, is not relevant as they are customers of Citi's competitors.
The judge's decision does not address the issue of purchasing licensing rights for Citi's ATM Community Network, a program launched in 2016 that allows customers of community banks and nonwhite-owned financial institutions to withdraw cash without a surcharge at Citi branch ATMs. Since its launch, Citi has removed such fees for 440,000 customers and 28 institutions.
Citi has a long institutional history of commitment to responsible banking and enabling economic progress. The bank has dedicated teams focused on the Community Reinvestment Act (CRA) governance and community reinvestment strategy. Citi’s CRA programs aim to meet and exceed regulatory requirements to serve underserved communities by advising on products, services, and delivery channels to meet community needs and reporting transparently on its impact.
Although the search results mention an ATM Ops and Service Continuum team focused on ATM and branch distribution strategies, specific details on the ATM Community Network program itself—such as its launch date, scope, or targeted impact—are not provided.
The judge considered the fact that the decisionmakers for financial institutions have agency to decide whether to join Citi's initiative as critical in evaluating the case's standing. The judge also noted in the order that the plaintiffs posited that the "express goal of the Policy was racial discrimination."
Singhal pointed out that if Citi hadn't launched its ATM program, the plaintiffs would still pay the same fee to access Citi's ATMs. The plaintiffs' request that Citi stop waiving fees for customers of minority-owned banks wouldn't change their situation, according to the judge.
As of Thursday, the plaintiffs had not filed an appeal of the judge's decision. The ruling does not specify any changes in Citi's ATM Community Network or its fee waiver policy for customers of minority-owned banks. The plaintiffs' attorneys did not immediately respond to a request for comment.
Despite the judge's dismissal of the lawsuit against Citi, the bank's ATM Community Network, designed to provide fee waivers for customers of community banks and nonwhite-owned financial institutions, remains a significant part of Citi's business approach in the finance sector, demonstrating their commitment to responsible banking and economic progress within underserved communities. In contrast, the plaintiffs, being customers of Citi's competitors, found no grounds to challenge the bank's ATM fee waiver program in this case, as their harm was not directly related to the program.
