Citigroup (C, Financial) is urging a U.S. District Judge to dismiss a lawsuit filed by New York State Attorney General Letitia James. The January lawsuit accuses Citibank, a subsidiary of Citigroup, of failing to compensate customers who fell victim to cyber fraud.
Citigroup's legal team asserts that the bank has robust procedures in place to protect consumers from fraudulent transactions. A company spokesperson emphasized that Citigroup complies with all legal requirements associated with wire transfers and strives to shield customers from threats, offering assistance to recover losses when possible.
The Attorney General's lawsuit claims that Citibank's lax security protocols allowed fraudsters to easily access customer accounts and execute unauthorized wire transfers, resulting in millions of dollars in losses for clients in New York. In April, Citigroup petitioned a federal judge for dismissal, arguing that U.S. states apply standards from the Uniform Commercial Code, which protect banks from liability if they implement commercially reasonable security measures to verify customer identities in good faith.
