The New York Attorney General filed a lawsuit against Citibank in January 2024 alleging violation of Reg E for failing to recredit account holders who were victimized in account takeover schemes resulting in unauthorized wires initiated from their account via online banking. The outcome of this case could impact credit unions offering wire transfers through online banking.

The lawsuit is unexpected, given that Reg E defines an electronic fund transfer (EFT) but specifically excludes wire transfers, which are instead governed by Article 4A of the Uniform Commercial Code.

TruStage will continue to monitor the outcome of the lawsuit and will provide updates when available.

For more information, read the full alert at: Trustage.com (Password and log-in required)