A Houston lawyer is suing Citibank after being taken for $182,500 by email scammers claiming to be a debt-chasing Japanese company, Texas Lawyer reports.
Richard T Howell Jr, of Buckley, White, Castaneda & Howell, fell for a classic cheque fraud scam. His "Japanese" contacts claimed they were pursuing four outstanding debts in the US - a total of $3.6m of which Howell would collect a healthy percentage for helping process the funds.
The scammers duly informed Howells that one debtor had agreed to stump part of what it owed, $367,500, and a "Citibank Official Check" for that amount subsequently arrived, which Howells deposited into one of his firm's account at the Sterling Bank in Houston.
Howell claims that an employee of his firm "telephoned Citibank and verified that check number 310096829 in the amount of $367,500 was paid". Howell then made a "wire transfer of $182,500 to a supplier of [the Japanese company] in Hong Kong".
Shortly afterwards, Sterling Bank informed him the cheque had been returned as "counterfeit", by which time it was too late to stop the wire transfer. Howells said he then "emailed the client but got no reply".
He admitted: "I'm a capital 'D' Dumbass."
While Howell has no chance of retrieving the lost cash, he is taking Citibank to task over the dodgy cheque. In December last year, his firm "sued Citibank in state court in Houston, alleging the New York bank was negligent and engaged in negligent misrepresentation when it represented to Howell that a $367,000 check - that was supposed to be a payment to Howell's client from a customer - had cleared when, in fact, it was a bogus check".
Howell is seeking "$182,500 in actual damages for Citibank's alleged negligence" plus "a minimum of $367,000 in punitive damages".
Citibank has denied the allegations and wants a "take-nothing judgment". The bank's attorney, Yasmin Atasi, insisted: "We are not liable for those funds."
The case is due to be heard in July. Texas Lawyer has further details of the scam and litigation here. ®