CREDIT CARD SWEEPING

A case in Sacramento County Superior Court recently settled wherein the State of California alledged that Citibank was stealing money from credit card holders. Many credit card customers pay Citibank for their credit card bill and then an item is returned and the back payment is sent to Citibank. This becomes a positive account balance in the card holders account. The normal procedure is to carry the positive balance and credit them against future purchases. There is a select group of people that are considered "recovery status" accounts. They carry the positive balance for 60 days and then take the money and call it "legal fees collected." This is called "Account Sweeping." Remember under California law, unclaimed funds escheat (or revert to) the state. However, Citibank would not disclose to the estate of decendents if they swept any funds from the decedents credit card (thus owing the decedents estate money). The co-plaintiff (the state intervened) Albert Mellon was an employee of Citibank and discovered that Citibank had programmed its computers to secretly "sweep" the overpayments under the rug so the state and estate of the decedent would not know that Citibank was holding the extra money. After over two years of investigation plaintiff Albert Mellon advised Citibank that it had taken millions of dollars from unsuspecting clients. Mr. Mellon was fired and his computer was seized by managment. The state Attorney General launched an investigation for criminal wrong doing. According to the state, a Citibank executive stated that the sweep program could not be stopped because it would reduce the executive bonus pool. The state settled with Citibank for $3,800,000.00 and included a number of injuctions preventing Citibank from re-initiating the credit sweeps. The plaintiff Mellon (whistleblower) was awarded $300,000.00.
Penney and Associates does not imply that the above case guarantee's any type of settlement or verdict on a similar case. Penney and Associates Loomis office handles all types of credit card cases and cases dealing with company wrong doings what ever they may be. Penney and Associates can be reached at http://www.penneyandassociates.com/.

Long Trial

I just finished a one week trial in Placer County Superior Court. It was a bench trial and will receive a verdict within the next few weeks. The case was a real estate case. I will blog later about the case.

An interesting Eminent Domain case just settled. Los Angeles Unified School District attempted to condemn Alberto Plinio Carrillo's property. The interesting thing about this case is that there were so many liens on the property (too many to mention) that everyone was fighting over how much and who got paid. The case finally settled for $700,000.00 with the distribution facts not disclosed. I would doubt if Mr. Carrillo received much if anything.

Sacramento Lawyer

Hello;
I work for Penney and Associates attorney's and I am excited to start blogging. See you soon.