Overview

• New York Attorney General Letitia James filed a civil suit on behalf of New York residents who lost funds to Zelle scams from 2017 to 2023.
• She alleges that EWS, owned by a consortium including JPMorgan Chase, Bank of America and Wells Fargo, launched Zelle without critical safety features and enabled account takeovers through multiple registration tokens.
• The complaint asserts that participating banks were not required to report fraud promptly and that EWS failed to deactivate fraudulent accounts in a timely manner, preventing fund recovery after immediate transfers.
• EWS introduced basic anti-fraud safeguards in 2019 but abandoned them before partially reinstating measures in 2023, after which reported fraud declined significantly.
• The state action follows the dismissal with prejudice of a similar CFPB lawsuit in March 2025, marking a shift toward state-level enforcement of payment network practices.