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Citibank, HSBC under MRTPC investigation

Citibank, HSBC under MRTPC investigation
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First Published: Wed, Apr 25 2007. 02 19 PM IST
Updated: Wed, Apr 25 2007. 02 19 PM IST
By PTI
New Delhi: The investigative arm of the country’s anti-monopoly watchdog has recommended action against two multinational banks for making false promises to their credit card customers and violating the RBI guidelines.
In its preliminary report submitted to the Monopolies and Restrictive Trade Practises Commission (MRTPC), the Director General of Investigation and Registration (DGIR) said that Citibank and HSBC have violated the rules framed by the Reserve Bank and caused loss to the general public.
DGIR had found that both banks were allegedly delaying delivery of bills and realisation of cheques toward payment just to charge increased interest rate, late fee and fine etc.
Moreover, DGIR also said the two banks were doing credit card business in the country through Direct Sales Agents, who were working either as independent contractors or on commission basis.
These DSAs were soliciting the general public by giving an impression that they were the direct agents of the bank -- without disclosing their independent status. It gives an impression to a common man that whatsoever promises they are making are as good as made by an officer of the bank, DGIR said.
It also said that DSAs of these banks even used government/semi-government offices and premises for soliciting business and sales promotion.
As per the terms and condition of the licenses granted by RBI, these banks are supposed to carry out their banking activities only from their own branches and offices, the report said.
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First Published: Wed, Apr 25 2007. 02 19 PM IST
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