US bank Citi fail to redact the personal information of nearly 150,000 people who went into bankruptcy between 2007 and 2011 due to a database mix-up, a US court has found.

The bank said it discovered in April 2011 that personal information – including social security numbers and dates of birth – was not redacted from bankruptcy claims, in contravention of bankruptcy court rules.

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In court documents filed by the bank in September 2011 and unsealed on Monday, Citi disclosed that CitiMortgage Inc., Citibank NA and CitiFinancial Inc. had filed proofs of claim in thousands of filings seeking payment from debtors.

Citi has since agreed to redact the information, according to the US Trustee Programme, which oversees the administration of bankruptcy cases in the country. The bank wrote to the affected people offering a year of free credit monitoring.

Clifford White, director of the US Trustee Programme, said creditors like Citi have a legal duty to protect personal information. "This settlement should remind all major financial institutions and other creditors that violations cannot be tolerated," he said.

The settlement was approved by the US bankruptcy Court in New York on 13 March 2012, and had been sealed until this week to prevent affected consumers being identified.

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The mix-up affected people in 85 separate jurisdictions across the US.

Read the settlement here.

 

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