A Citibank customer is now facing a painful $120K loss after the bank froze her deposit and threatened to close her account.
A woman in Arizona says her life savings of $120,000 has disappeared from her bank account after transferring her money from a regional California bank called Farmers & Merchants, reports the CBS-affiliated news station KPHO.
Lomax says her Citibank account initially showed the money had arrived, but soon after her debit card was declined.
“[The money] was actually right there on the screen. And then poof! It just disappeared.”
Citibank then sent Lomax a notice in the mail saying she breached the bank’s terms of agreement, the money had been sent back to its “rightful owner,” and her account would be terminated in 60 days.
Lomax then contacted Farmers & Merchants, who told her the money is gone, reports DH.
“I’m at my wit’s end. I don’t know what to do anymore. I’m climbing the walls. There are nights that I’ll go through half a box of Kleenex crying…
My biggest fear is that they sent it somewhere and somebody else got it, and they are saying ‘Christmas came early this year!’
I’d like my money back. I’d like to buy a home so I can live my last 20-30 years comfortably.”
Despite the termination notice from Citibank, both banks say they are now investigating the matter.
“Reports of banking customers dealing with abrupt account closures due to concerns of suspicious behavior have ramped up in recent years.
The number of Suspicious Activity Reports (SARs) submitted by banks to law enforcement was about 830,000 in 2014.
That number has steadily increased, with about 1.4 million SARs reported in 2021.
However, according to the Banking Policy Institute, just 4% of SARs submitted by banks to law enforcement result in a follow-up, and a small fraction of the follow-ups result in arrests and convictions,” reports DH.
Wells Fargo Customer Also Faces A Similar Problem
Wells Fargo is now freezing bank accounts according to new reports from a customer, which has now led to a lawsuit.
“Wells Fargo seized a customer’s funds and shut down his bank account over a legitimate $207,765 deposit.
Ethan Parker says he opened a new account at the bank late last year specifically to deposit a large check that he received after the death of his adoptive mother.
But 15 days after the deposit, Parker says Wells Fargo shuttered the account, took the funds and accused him of forging the check,” reports DH.
According to the lawsuit, Parker then obtained a letter from the firm that issued the check to confirm its legitimacy.
But the bank was not swayed and continued to deny Parker access to the funds without “adequate explanation.”
The lawsuit asks the courts to force Wells Fargo to release the funds, and says Parker has been damaged in an “amount to be proved at trial.”
In a statement to Triangle Business Journal, a Wells Fargo spokesperson says the bank plans to defend its actions.
“We strongly disagree with the allegations made in the suit filed by Mr. Parker, and will defend our position as we believe Wells Fargo took the appropriate actions.”
Parker says he’s now unable to make house payments, and his lawyers say they’re looking for other people whose accounts were “improperly closed” by the bank over accusations of fraud.
But Wells Fargo isn’t the only bank freezing customer accounts.
The US Treasury Direct (TreasuryDirect) has left users without access to their accounts from weeks to months according to several reports.
Bank of America had also frozen more than 1,000 accounts connected to Coinbase this past summer.
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