Citi is accused of harassing Armenian-Americans and treating them like criminals, the U.S. regulator alleges.

Bank Citibank illegally discriminated against the Armenian American community by denying them credit cards because of their last names, according to a federal regulator.

A Consumer Financial Protection Bureau (CFPB) investigation from 2015 through 2021 found Citibank "targeted" applicants by associating them with Armenian ancestry. The regulator says Citibank treated Armenian-Americans as fraud-prone criminals and applied stricter criteria to their applications, denying credit or requiring additional information.

According to the CFPB, the bank targeted applicants with last names ending in "-ian" and "-yan" as well as residents of Glendale, California, which has a large Armenian American population.

As a result, the regulator required Citibank to pay $25.9 million in fines and compensate customers. Speaking about the incident, a Citibank spokesperson said that the unacceptable actions of several employees taken to combat an alleged Armenian fraud ring in California are regrettable and that the bank has taken appropriate steps to prevent similar situations from happening again in the future.

The regulator also noted that Citibank has violated consumer protection laws before. Citibank has already paid fines for violating the disclosure law and for "deceptive and unfair practices" related to overcharging customers on credit cards.