Citibank Sued Over Alleged $20M Crypto Romance Scam Oversight

Citibank faces legal action for allegedly failing to detect suspicious transactions linked to a $20 million cryptocurrency romance scam. The plaintiff, Michael Zidell, claims the bank ignored red flags including large round-number transfers to a dubious entity, enabling fraudsters to siphon nearly $4 million from his accounts.

The case spotlights mounting scrutiny of banks' anti-fraud measures in digital asset transactions. Filed in Manhattan federal court, the lawsuit describes a classic 'pig butchering' scheme where scammers cultivated a fake romantic relationship through social media before funneling victims into fraudulent NFT investments.

Financial institutions now confront growing pressure to strengthen safeguards as crypto-related fraud proliferates. The Zidell case may set precedents for bank liability in detecting sophisticated web-based financial scams.