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Citigroup Urges Dismissal of New York’s ‘Misguided’ Lawsuit Over On-line Scams



Citigroup on Tuesday urged a federal decide to dismiss New York Lawyer Common Letitia James’ lawsuit accusing its Citibank unit of failing to reimburse clients who fall sufferer to on-line scammers.


Whereas recognizing that the issue of on-line wire fraud “is actual,” the third-largest U.S. financial institution faulted James’ “misguided” effort to carry it liable below a federal legislation governing digital fund transfers as a result of it expressly excludes wire transfers.

Citigroup stated the correct customary from the Uniform Business Code, which all U.S. states use, excuses banks from overlaying losses if in good religion they undertake commercially cheap safety measures to confirm buyer identities.


The New York-based financial institution stated it has performed so, and stops “numerous” fraudulent transactions every day.

“No system will catch each rip-off each time,” however the resolution just isn’t a lawsuit that might “abruptly and dramatically upset how banks have organized their insurance policies and practices for many years,” Citigroup stated in a submitting in Manhattan federal court docket.


James’ workplace didn’t instantly reply to a request for remark.

The legal professional common sued Citibank in January.


She stated the failure of its safety methods to successfully examine purple flags resembling utilizing unrecognized units, altering person names and passwords, and “phishing” enabled scammers to steal hundreds of thousands of {dollars}.

In a single occasion, a buyer allegedly misplaced $40,000 of retirement financial savings after clicking a hyperlink in a textual content message that gave the impression to be from Citibank.


James additionally accused Citibank of coercing victims into signing affidavits that presupposed to slender their capability to recoup losses, after which summarily rejected reimbursement claims.

The legal professional common desires Citibank to pay again defrauded New Yorkers, pay a $5,000 civil fantastic per violation, and appoint an out of doors monitor to overview financial institution information and find victims.


The case is New York v Citibank NA, U.S. District Court docket, Southern District of New York, No. 24-00659.

(Reporting by Jonathan Stempel in New York; Enhancing by Stephen Coates)


New York


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