In the year 2010, is it possible for a financial institution to close a business account of an organization due to race, creed or sexual preference? Since Citibank has taken this unprecedented step with a gay social network due to what they deemed as "objectionable content" posted on the new startup fabulis' blog - wouldn't logic indicate they could do the same thing to a church group or a black civics organization?
Jason GoldbergThe situation unfolded as such. On February 24, Jason Goldberg, founder of fabulis received the disturbing news that someone(s) at Citibank had decided arbitrarily to block fabulis' bank account due to what was described to them as "objectionable content" on their blog. As Goldberg described it he was told his blog: "content was not in compliance with Citibank's standard policies - and yes, that quote is indeed correct." In fact the account was blocked a few days prior without any advance notice given to Goldberg by phone or email.
Upon reflection, Goldberg could not understand what the bank deemed "objectionable?" But more important he questioned, "when did Citibank start reviewing blogs to decide who could bank with them?" Particularly for an account of a company that was backed by some heavy-weight investors, having just raised $625,000 in seed funding on January 29 from the likes of the Washington Post and Venture Partner at Mayfield Fund Allen Morgan.
citibank logo24 hours later, Goldberg updates his blog indicating that the bank spokesperson said that "all 3 of the Citibank individuals who over the past 24 hours each individually claimed that fabulis' account was to be terminated for compliance issues around the content of our sites, were all wrong to have said what they said."
Subsequently on February 25, Goldberg received an apology email from William E. Brown identifiedBill Brown Citibank as Division Manager Citibank Manhattan.
The question that Goldberg and others want to know - is even with such an apology is the damage created so great that it is best to make a statement and move fabulis' funds to a more reputable banking institution? If have a strong opinion on this issue (pro or con), you are invited by Goldberg to post your comments here. You can also tweet your thoughts to the manager of their Twitter account @fabulis.
- From: Brown, William E
Date: Thu, Feb 25, 2010 at 4:14 PM
We have not been formally introduced and I imagine that this is a poor way to become acquainted. I am responsible for the Citibank Branches in Manhattan and have just learned today of the challenges you have experienced in opening an account with us.
I apologize for any confusion about the status of your account and the Fabulis website. Whatever statements that were made by any Citi representative related to the content of your website were inappropriate and made in error, and I will review in detail what happened. You have my firm commitment on this point.
I truly regret any unintended message that my employees may have conveyed about your new business venture. I place great value on your business and assure you that Citi is committed to the gay, lesbian, bisexual and transgender communities. In fact, this week Citi has announced the financing for the True Colors Residence, a housing facility for homeless GLBT youth in New York City.
I recognize that, to this point, this dialogue has been carried out on the internet via postings. You may choose to post this apology, however, please do not doubt the sincerity of my message and the responsibility I have for ensuring our customers do not encounter a similar experience.
Citibank may believe they have responded appropriately and perhaps they have. But they will need to do a lot more in damage control to convince the public that this was an honest mistake. The days of "don't ask, don't tell," are just about over - one would hope!