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itibank announced Thursday that it would hire up to 1,400 personnel to collect debts after the central bank found there were irregularities in the bank’s debt collection practices previously handled by third-party debt collectors.

Indonesia Citi country officer Shariq Mukhtar said that the bank would complete the hiring process for the in-house debt collectors on April 29.

“This is beneficial for all parties and strengthens control and management in this area. It also reflects our commitment to providing a better service to our customers,” Shariq said in a statement sent to The Jakarta Post.

The bank’s latest move came after Bank Indonesia (BI) Governor Darmin Nasution said Wednesday that the central bank would slap more sanctions on Citibank after it found the troubled American bank violated the standard operational procedures (SOPs) in its debt collection and private banking services.

Citibank’s procedures placed the responsibilities on the third party debt collectors, while a BI regulation (PBI) stipulates that banks must be held responsible for collection issues, BI spokesman Difi A. Johansyah said, citing the 2009 PBI on credit card payment and a circular letter dated 11/10/2009.

The debt collection fiasco dated back to earlier this month when a Citibank customer, Irzen Octa, was found dead after meeting the bank’s debt collectors, who allegedly beat up the customer after he complained about his inflated credit card bill.

BI and the Indonesian Credit Card Issuer Association are currently finalizing new rulings and codes of conduct on debt collection and credit card practices after the House of Representatives told the central bank to detail the regulations to mitigate negative impacts of the practices.

“Citibank is committed to complying with the central bank’s new guidelines and the House
of Representatives’ recommendations,” Shariq said.

Citi Indonesia’s country corporate affairs head Ditta Amarhoseya expressed a similar view, saying that the bank was ready to cooperate with the central bank to mend its business operations accordingly.

“We are working closely with the regulator to understand and address concerns they have about our debt collection practices,” she told the Post.

BI previously asked Citibank to stop processing new credit card applications pending an investigation into the death of Irzen by the National Police, which have detained three suspects allegedly involved in the case.

Citibank’s relations manager for its Citigold wealth management service Malinda Dee is currently under police custody for alleged embezzlement of client funds worth more than Rp 16 billion.