By Jonathan Stempel
(Reuters) -Citigroup asked a U.S. judge to dismiss a racial-discrimination lawsuit that claims the bank violated federal civil rights law by waiving ATM fees for customers of minority-owned banks.
The third-largest U.S. bank had been sued in May by two Florida customers, Werner Jack Becker and Dana Guida, who do not bank with Citigroup and were charged fees for using its ATMs.
Their proposed class action objected to Citigroup's policy since 2016 of waiving out-of-network ATM fees for customers of minority-owned banks and credit unions, while charging customers whose banks were owned by people of the "wrong race."
The fees are typically $2.50 per withdrawal, according to Citigroup's website.
In a filing late on Wednesday in Fort Lauderdale, Florida federal court, Citigroup said its ATMs do not know users' race, meaning that race did not matter when it charged fees.
The New York-based bank added that Becker and Guida are not contractually required to use its ATMs, and did not show their own banks were treated unequally. It said civil rights law was not a "remedy for all racial injustice."
Lawyers for the plaintiffs did not immediately respond to requests for comment on Friday.
The plaintiffs are represented by Consovoy McCarthy, which often argues conservative causes, and in 2023 persuaded the U.S. Supreme Court to reject race-based college admissions programs.
In a statement on Friday, Citigroup called expanding banking access in underserved communities "core to our mission of enabling growth and economic progress," and said it believed the fee waiver program will withstand any legal challenges.
The bank also disputed that the program has race-based eligibility criteria, saying in Wednesday's filing that 14 of the 50 participating lenders are not "minority-owned."
The case is Becker et al v. Citigroup Inc (NYSE:C), U.S. District Court, Southern District of Florida, No. 24-60834.