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Citibank Stole From 53,000 Customers
Topics in Legal News |
2008/08/27 11:24
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Citibank agreed Tuesday to repay $14 million taken from 53,000 customer credit accounts, plus interest and penalties, after after a three-year investigation by the California Attorney General's office revealed the bank's policy of clearing positive balances off customer credit accounts.
Citibank used a computerized process between 1992 and 2003, which automatically and immediately erased positive balances from credit-card accounts. The Attorney General's office quotes a bank executive saying, "Stealing from our customers is a business decision, not a legal decision."
Underscoring the intentional nature of the bank's actions, the Attorney General said an insider at Citibank reported the credit sweeps to an internal audit team in 2001, and was first ignored and then fired.
The investigation took three years to complete because the state investigators had to overcome legal trench warfare from Citibank which resisted subpoenas from the state to third parties who had information about the theft, said a spokesman for the Attorney General.
"The company knowingly stole from its customers, mostly poor people and the recently deceased when it... implemented the sweeps," said California Attorney General Jerry Brown Jr.
Positive balances happen when a customer over-pays, or when a customer returns a purchase for credit. A spokesman for Brown's office, Dana Simas, said the poor and the dead tend to be less financially organized, which accounts for their increased exposure to Citibank's credit sweeps.
$1.6 million was swiped from Californians alone.
Citibank was represented in the matter by Julia Strickland and Julie Nelson with the Stroock law firm.
The settlement calls on Citibank to refund the victims for the amount stolen, along with a 10% interest. It also imposes a $3.5 million fine to be paid to California, and prevents Citibank from re-initiating the credit sweeps.
Once Citibank has complied, an independent auditor will ensure that Citibank has fulfilled its requirements.
The state's investigation was led by Frederick Acker. |
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Court says Guantanamo documents should be released
Topics in Legal News |
2008/08/22 08:36
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| A British court ordered Foreign Secretary David Miliband on Thursday to disclose secret documents that could prove critical to the defense of a Guantanamo Bay detainee who claims he was tortured while in U.S. custody on terrorism charges. Miliband now has a week to decide whether to comply with the order to release of the documents pertaining to Binyam Mohamed's detention. The British government has argued the release of the documents could compromise national security, and it could appeal the court order. The High Court made the ruling in the case of Mohamed, who was captured in Pakistan in April 2002 and accused of conspiring with al-Qaida leaders to attack civilians. His lawyers say the British government is withholding information about his treatment in U.S. custody which is critical to his hope of receiving a fair trial. "The information held by the foreign secretary is not merely necessary, but essential, if Binyam Mohamed is to have his case fairly considered," Judge John Thomas wrote in the 75-page judgment. Mohamed claims he was transferred illegally from Pakistan to Morocco after his arrest and alleges he was tortured during his 18 months in detention. Neither the United States nor Britain has disclosed any information about his time in custody until he arrived at Guantanamo Bay in 2004. |
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Urban League Challenges Illinois School Funding
Topics in Legal News |
2008/08/21 07:09
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Poor schools in Illinois suffer the nation's second-largest funding gap with wealthy districts because of the state's unconstitutional school funding formula that disparately hurt black and Latino students, the Chicago Urban League claims in Cook County Court.
As a result, poor and minority students face financial crises that force them into larger classes in poorly maintained facilities; programs for music, arts and sports have been slashed; and students are denied a "high quality" elementary and secondary education guaranteed under the Illinois Constitution, the complaint states.
Despite its great capacity for raising revenue and its obligations under the Illinois Constitution to take "primary responsibility" for school funding, the State over-relies on local property taxes to finance schools, states the complaint against the State of Illinois and the State Board of Education.
Plaintiffs, the Chicago Urban League and the Quad County Urban League, are represented by Lisa Scruggs with Jenner & Block. |
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Steve Wynn Sues Soft-Core Porn King
Topics in Legal News |
2008/08/13 07:15
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"Girls Gone Wild" mogul Joseph Francis faces another lawsuit, this time from billionaire Stephen Wynn, who claims that Francis defamed him with the false accusation that Wynn stiffs high rollers in his hotel casinos.
Wynn, owner of Wynn Las Vegas and the Encore, first sued Francis in July, claiming the soft-core porn king owed $2 million in gambling debts from February 2007.
Francis insisted he had already paid his debt through agreements and discounts.
Francis told The Associated Press, "The Wynn Hotel has chosen not to honor its agreement to apply certain discounts to balances they have already been paid for."
Francis also indicated that he planned on "exposing how exactly Mr. Wynn deceives his high-end customers."
Wynn responded with this defamation lawsuit in Clark County Court, claiming he has suffered injury to his reputation and "shame, mortification, hurt feelings and emotional distress."
In June, Francis pleaded not guilty to charges of tax evasion for allegedly deducting more than $20 million of bogus business expenses on his 2002 and 2003 returns. Trial is set for Sept. 16 in Los Angeles.
Francis claims that he never saw his tax returns before they were filed, and that his accountant contacted the IRS after quitting and reported the accounting mistakes to collect money through the Tax Whistleblower Program.
Wynn is represented by Frank Schreck with Brownstein Hyatt |
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DuPont Loses Bid to Enforce Supply Contract
Topics in Legal News |
2008/08/12 07:09
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A state judge denied E.I. du Pont de Nemours & Co.'s request to enforce a supply contract that Bayer CropScience canceled, threatening DuPont's supply of chemicals used in its Require and Resolve corn herbicides.
Vice Chancellor Stephen Lamb of the Delaware Chancery Court refused to grant an injunction requiring Bayer to carry through on its shipping commitment. Bayer claimed du Pont breached the contract by introducing a new product line that exceeds the scope of its license and violates the terms of the supply agreement.
But DuPont maintained that it never breached the contract, and asked the court to prevent Bayer from cutting off its chemical supply.
Concluding that the wording of the contract favors Bayer's interpretation, Vice Chancellor Lamb refused to issue the injunction. |
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