Attorney General James Announces Court Win Allowing Lawsuit Against Citibank to Continue

NEW YORK – New York Attorney General Letitia James today announced a significant victory in her case against Citibank (Citi) after a judge denied Citi’s motion to dismiss the Office of the Attorney General’s (OAG) lawsuit on its core claims that Citi failed to protect and reimburse victims of fraud. The lawsuit alleges Citi misleads its customers about their rights after their accounts are hacked and funds are stolen and illegally denies reimbursement to victims of fraud. The decision by Judge Paul Oetken of the United States District Court for the Southern District of New York, which held that Citi misapplied the law when denying consumers’ claims for reimbursement, means that Attorney General James’ lawsuit against Citi will continue. In particular, the court found that a landmark consumer protection law known as the Electronic Fund Transfer Act (EFTA) applied to unauthorized wire transfers made through Citi's consumer accounts. 

“When New Yorkers deposit their money in a bank, they expect it to be kept safe from scammers and thieves,” said Attorney General James. “Citi’s failures to protect its customers’ accounts are costing New Yorkers millions of dollars. Today’s decision will allow us to continue our case against Citi to help those whose savings were stolen and ensure the bank follows the law to protect its customers.”

In January 2024, Attorney General James sued Citi, one of the largest banks in the country, for failing to protect its consumers when they fall victim to fraud. The lawsuit alleges that scammers can steal from Citi’s customers because the bank fails to implement strong data security and anti-breach practices. As a result of Citi’s inadequate security, ineffective monitoring systems, and failure to respond in real-time and properly investigate fraud claims, New Yorkers have lost millions to scammers. While Citi was obligated to reimburse those losses, today’s decision found that the bank misapplied the law to avoid its obligations to consumers. Attorney General James is seeking to stop Citi’s deceptive practices and to collect restitution for victims who were denied reimbursement in the last six years, as well as penalties and disgorgement.

This matter is being handled by Assistant Attorney General Chris Filburn with the Consumer Frauds and Protection Bureau. The Consumer Frauds and Protection Bureau is led by Bureau Chief Jane Azia and Deputy Bureau Chief Laura Levine, and is a part of the Division of Economic Justice, which is overseen by Chief Deputy Attorney General Chris D’Angelo and First Deputy Attorney General Jennifer Levy.