New York state is suing one of the nation’s largest banks, accusing it of implementing weak security measures, deceiving customers about their rights and refusing to refund fraud victims as required by law.
New York Attorney General Letitia James To tell Her office decided to sue Citibank after the bank failed to protect its customers over the past six years.
The AG says Citibank’s digital defenses do not effectively address a number of red flags, including:
- Unusual transfers from multiple accounts to a single account
- Use of unknown device
- Account access from new location
- Trying to change your online banking password and username
“As a result of Citi’s lax security, New York customers have lost millions of dollars, and in some cases their entire life savings, to scammers and hackers.
Attorney General James will hold Citi accountable for its failures to protect customers, strengthen fraud prevention measures to prevent fraudsters from stealing consumer funds, and reimburse defrauded New Yorkers with interest; They are trying to require the City to pay a penalty. ”
The AG also found that Citi did not conduct its own investigation into the fraud incident and did not report it to the appropriate authorities after being notified by customers.
The bank also said Citi was too slow to respond effectively to desperate calls from fraud victims.
“When victims contact their banks to report fraud, Citi puts them on hold for long periods of time, allowing the fraudsters to continue their fraud.”
The AG alleges that Citi fails to protect customers from online banking fraudsters and engages in deceptive practices designed to circumvent the law and deny customers refunds.
“Under EFTA (Electronic Funds Transfer Act), banks such as Citi are required to refund money in customer accounts that is lost or stolen through fraudulent electronic payments. However, Citi is required to comply with these laws. They unlawfully used a narrow exception to deny consumers’ reimbursement claims, resulting in millions of dollars in losses for New York consumers.”
Mr. James’s office ordered Citi to strip benefits, pay a $5,000 fine for each violation of the law, and require an independent third party to identify all customers harmed by the bank’s alleged illegal activities. is requested to be appointed.
Attorney General James says:
“Banks are supposed to be the safest place to keep your money, but Citi’s negligence has allowed fraudsters to steal millions of dollars from hard-working people.
Many New Yorkers rely on online banking to pay bills and save for big milestones, and when banks fail to protect their customers’ accounts, they are failing in their most basic obligations. It will be.
There is no excuse for Citi’s failure to protect and prevent millions of dollars from being stolen from customers’ accounts, and my office will not write off the big banks’ wrongdoing. ”
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