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
‘We’re trapped!’: Panicked 911 audio from South Carolina fire where judge’s husband leapt to safety

Heart-Stopping 911 Call: Judge’s Husband Escapes Fiery South Carolina Inferno

EXCLUSIVE ON FOX: Heartbreaking 911 recordings from an October blaze that destroyed…
Graphic anti-ICE imagery at University of Wisconsin shows agent with bullet in head: 'Speak their language'

Shocking Anti-ICE Imagery Sparks Controversy at University of Wisconsin: A Call to ‘Speak Their Language

Authorities at the University of Wisconsin-Madison have launched an investigation into an…
Judge that ordered release of 600 Chicago illegal immigrants slammed by DHS as activist putting lives at risk

Controversial Judge’s Decision to Release 600 Immigrants in Chicago Sparks DHS Backlash Over Public Safety Concerns

A federal judge in Chicago has mandated the Department of Homeland Security…
Legal group accuses Virginia public school district of felony after hosting Dem political rally for free

Legal Action Taken Against Virginia School District Over Free Political Rally Hosting

A public-interest litigation firm, known for its nonpartisan stance, is urging a…
Breaking China's Grip: Alaska Graphite Mine Now Yields Critical Minerals

Alaska Graphite Mine Disrupts China’s Dominance with Critical Mineral Production

Graphite’s versatility is undeniable, playing a crucial role in a variety of…
Authorities: Planned workplace attack leaves young Minnesota woman dead, coworker charged

Tragic Workplace Attack in Minnesota: Young Woman Killed, Colleague Charged

A shocking tragedy unfolded in Cokato, Minnesota, where a young woman lost…
Cowboys to support Marshawn Kneeland pregnant girlfriend, unborn child 'for the rest of their lives'

Dallas Cowboys Commit to Lifelong Support for Marshawn Kneeland’s Pregnant Partner and Future Child

FRISCO, Texas — The Dallas Cowboys community is reeling from the tragic…
Trump's next immigration crackdown will target Charlotte, North Carolina, sheriff says

Charlotte, NC Braces for Impact: Trump’s New Immigration Policy Targets Local Enforcement

CHARLOTTE, N.C — Charlotte, North Carolina, is the latest city preparing for…
Palmdale Street shooting on Jacksonville's Northwest side leaves man dead

Breaking News: Shooting Incident at Jacksonville’s Woodland Acres Leaves Man Seriously Injured

JACKSONVILLE, Fla. — A man is on the mend after sustaining a…
Fort White woman killed in motorcycle crash on County Road 778

Tragic Motorcycle Accident Claims Life of Fort White Woman on County Road 778

A tragic accident claimed the life of a 69-year-old woman on a…
8-year-old boy suffers concussion, broken bone after part of ceiling collapses at Hanford elementary school in California

Shocking Incident: Ceiling Collapse at Hanford School Injures 8-Year-Old Boy

In Hanford, California, 8-year-old James Harrah stood out on Monday, sporting an…
Russian spy ship detected just miles from Hawaii coastline prompts US Coast Guard response

US Coast Guard Responds to Russian Spy Ship Spotted Near Hawaii Coast

The United States Coast Guard reported on Thursday that it detected a…