NEW YORK (Legal Newsline) - New York Attorney General Letitia James is suing Citibank, alleging scammers face no opposition from the company's safety guards.
The State of New York, represented by James, filed a lawsuit Jan. 30 in U.S. District Court for the Southern District of New York against Citibank N.A. The complaint alleges that the bank has failed to provide adequate data security measures to protect consumer financial accounts from increasingly sophisticated online and mobile banking scams.
These scams, including phishing and mobile device hacks, have allegedly cost New Yorkers millions.
The suit claims that Citibank has overpromised and underdelivered on security, reacted ineffectively to fraud alerts, misled consumers and denied their claims. The bank is accused of failing to adhere to the Electronic Fund Transfer Act (EFTA), which provides substantial protection for consumers against unauthorized electronic payments.
Citibank's alleged practices include not taking immediate action to recover amounts wired out when notified of fraudulent activity on consumers' accounts. Instead, it's claimed that they assure customers their money is secure and instruct them to visit local branches where they are asked to complete affidavits of unauthorized online wire transfers.
The State of New York argues that these practices shift the blame onto consumers and evade the robust protections provided by the EFTA.