New York Paralegal Blog

In a significant legal move, New York Attorney General Letitia James has filed a lawsuit against Early Warning Services (EWS), the company that operates the popular payment platform Zelle. This lawsuit alleges that EWS, which is owned by major U.S. banks like JPMorgan Chase and Bank of America, failed to protect its users from widespread fraud, leading to over $1 billion in stolen funds between 2017 and 2023. 💸 What's the main issue? The lawsuit claims that EWS designed Zelle without crucial safety features, making it a prime target for scammers. According to the Attorney General, EWS knew about these vulnerabilities from the beginning but prioritized speed and ease of use over security to compete with other apps like Venmo and PayPal. This lack of security allowed fraudsters to easily infiltrate the network. Some common scams include: Impersonation: Scammers pretend to be someone you know or a trusted company (like a utility provider) to trick you into sending them mo...

NEW YORK, NY – Six individuals have been sentenced for their roles in a large-scale, unlicensed money transmitting operation that moved over $15 million in a matter of months through an informal system known as "hawala." The sentences, handed down in the White Plains federal court, mark a significant victory for federal investigators in their efforts to curb illicit financial activities. What is a "Hawala"? Essentially, a hawala is a way to transfer money, often across borders, without any physical cash actually moving. It relies on a network of brokers who receive money in one location and then have an associate in another location pay out the same amount to the intended recipient. While not inherently illegal, operating such a service without a license from state and federal authorities is a serious crime, as these networks can be used to launder money for criminal enterprises. The Investigation and Convictions Between February and September of 2023, the group ra...