NY attorney general sues Zelle's parent company, alleging the payment service enabled widespread fraud
Share this @internewscast.com

On Wednesday, New York’s attorney general initiated a lawsuit against the parent company of the Zelle payment platform. This move comes months after the federal Consumer Financial Protection Bureau ceased a similar legal action during a period when the Trump administration was significantly scaling back the agency’s operations.

Letitia James, the Attorney General and a member of the Democratic Party, filed this case in New York state court. The lawsuit targets Early Warning Services, a firm owned by several U.S. banks, accusing it of not incorporating key security measures into Zelle’s design, thereby leaving users exposed to fraudulent activities.

Options to use the Zelle payments network are seen on a mobile banking app in New York, Dec. 20, 2024.

Options to use the Zelle payments network are seen on a mobile banking app in New York, Dec. 20, 2024.

AP Photo/Patrick Sison, File

Earlier this year, the Consumer Financial Protection Bureau withdrew a comparable lawsuit, following the dismissal of its leader by President Donald Trump. The administration subsequently shut down many of the bureau’s operations, closed its main office, and initiated a series of layoffs.

According to a statement from James’ office, their lawsuit was introduced in response to the Consumer Financial Protection Bureau’s decision to drop their case due to a “change in the federal administration.”

“No individual should be left vulnerable after becoming a victim of fraud,” James expressed in a statement. “I am eager to seek justice for the New Yorkers who suffered due to the insufficient security measures of Zelle.”

James has been a prominent opponent of Trump and has taken legal action against him numerous times. Recently, reports by The Associated Press and other media indicated that the Justice Department has issued a subpoena to James as part of an inquiry into whether she infringed upon Trump’s civil rights, according to sources familiar with the situation.

James’ case against Early Warning Services alleged that Zelle, which allows users to send and receive near-instant money transfers, failed to include adequate verification processes. Her office said scammers were able to access peoples’ accounts or trick users into sending money to bogus accounts that posed as official businesses.

In one instance cited by the attorney general’s office, a Zelle user got a call from someone posing as an employee of the utility company Con Edison who told the user that his electricity was going to be shut off unless he sent them money through Zelle. The user then transferred about $1,500 to a Zelle account named “Coned Billing” and then realized he had been scammed but was told by his bank that he could not get his money back, James’ office said.

In a statement issued through a spokesperson, Zelle called James’ lawsuit “a political stunt to generate press, not progress.”

“The Attorney General should focus on the hard facts, stopping criminal activity and adherence to the law, not overreach and meritless claims,” the statement said.

Copyright © 2025 by The Associated Press. All Rights Reserved.

Share this @internewscast.com
You May Also Like
How Israel's 'eye in the sky' over Iran has allowed it to pinpoint and target 'thousands' of regime officials in hopes of sparking uprising

Israel’s Advanced Aerial Surveillance Over Iran Targets Thousands of Regime Officials to Incite Uprising

Israel’s sophisticated aerial surveillance system has enabled the nation to effectively target…
Tulsi Gabbard hires ex-Pentagon official skeptical of US war with Iran

Tulsi Gabbard Appoints Former Pentagon Official Known for Skepticism on US-Iran Conflict

Dan Caldwell, a former Pentagon official known for his critical stance on…
Markwayne Mullin tells senators Homeland Security needs funding as he faces confirmation hearing

Markwayne Mullin Urges Senators to Boost Homeland Security Funding During Confirmation Hearing

WASHINGTON — Markwayne Mullin, recently nominated by the White House for the…
Sen. Joni Ernst reveals $77B in 'secret' defense spending kept from taxpayers

Sen. Joni Ernst Uncovers $77 Billion in Concealed Defense Expenditures, Sparking Transparency Debate

WASHINGTON — In a significant revelation, Sen. Joni Ernst (R-Iowa) disclosed to…
Realtor's cold case murder finally solved after 15 years, police say

15-Year Mystery Unraveled: Realtor’s Cold Case Murder Solved with New Breakthrough

In a significant breakthrough, Iowa authorities have finally made an arrest in…
Chicago firefighter death: Funeral arrangements announced for CFD member Michael Altman, who died after being injured in fire

Honoring a Hero: Funeral Plans Released for Chicago Firefighter Michael Altman After Tragic Fire Incident

The Chicago firefighting community is mourning the loss of one of their…
Russia ships fuel to Cuba using 'spoofing' tactic challenging Trump embargo: reports

Russia Circumvents Trump-Era Embargo to Deliver Fuel to Cuba: Reports Reveal ‘Spoofing’ Strategy

Recent maritime intelligence reports reveal that Russia is discreetly transporting oil to…
Family of missing Alabama student James Gracey not sure if cell phone was lost or stolen after vanishing from Barcelona nightclub

Uncertainty Surrounds Missing Alabama Student James Gracey’s Cell Phone Status After Disappearance from Barcelona Nightclub

The family of James Gracey, a University of Alabama student who went…
Lone actors 'most likely' to commit US terror attacks: intel report

Intelligence Report Identifies Lone Actors as Predominant Threat in Potential U.S. Terror Attacks

This morning, the Office of the Director of National Intelligence unveiled its…
Federal judge temporarily changes grand jury rules after Trump effort to charge members of Congress

Federal Judge Alters Grand Jury Protocol Amid Trump’s Bid to Indict Congress Members

Chief U.S. District Judge James Boasberg, known for his frequent judicial clashes…
Driver charged in crash that killed ‘Marvelous Mrs. Maisel’ actress Wenne Alton Davis

Tragic Collision: Driver Faces Charges in Fatal Crash of ‘Marvelous Mrs. Maisel’ Star Wenne Alton Davis

In a tragic turn of events, a Bronx driver has been charged…
Creep allegedly attempted to rape 84-year-old in NYC park bathroom

Shocking Incident: Attempted Assault on 84-Year-Old in NYC Park Bathroom Sparks Outrage

A 30-year-old man from Manhattan has been taken into custody for allegedly…