Crypto Scam Victim Files Lawsuit Against Two Banks Over Alleged Negligence

According to Cointelegraph, Michael Zidell, who claims to be a victim of a crypto romance scam, has filed a lawsuit against East West Bank and Cathay Bank in a California federal court. Zidell accuses the banks of neglecting their statutory duties and obligations by failing to identify suspicious transactions. He alleges that he transferred nearly $7 million to an account at East West Bank and over $9.7 million to an account at Cathay Bank, both allegedly controlled by scammers. Zidell's legal actions follow a previous lawsuit against Citibank, filed on June 24, where he accused the bank of ignoring red flags in 12 transfers totaling approximately $4 million. The lawsuits stem from a relationship Zidell claims to have formed with "Carolyn Parker," a supposed business owner he met on Facebook in early 2023. Parker allegedly convinced Zidell to invest in non-fungible tokens (NFTs), leading him to transfer over $20 million to various bank accounts provided by a trading platform she recommended. Zidell claims the platform disappeared by April 2023, along with his investments. The lawsuit against East West Bank and Cathay Bank seeks to hold them accountable for negligence and for allegedly aiding and abetting securities fraud. Zidell argues that the banks facilitated the scam by providing services such as opening accounts and processing wire transfers without adequately monitoring for suspicious activity. He contends that the banks should have investigated the large, round-number transactions that were indicative of fraudulent activity. Additionally, Zidell's complaint includes allegations of "aiding and abetting elder abuse" against East West Bank and Cathay Bank, a charge not made against Citibank. While Zidell's age is not specified in the complaint, California law defines an elder as someone 65 years or older. Zidell is seeking compensatory damages, legal costs, and interest through a jury trial.