Legal issues and news

The House Financial Services Committee's Republican majority backed slower funds availability and declined to shift authorized-scam losses onto banks.

BNY's Robin Vince and Nubank's David Velez have joined the boards of the OpenAI Foundation and OpenAI Group Public Benefit Corporation; Old National Bancorp has revamped its top leadership teams; City National Bank appointed Lindsay Dunn executive vice president and head of personal and business banking; and more in this week's banking news roundup.

The New York AG is alleging banks aren't doing enough to combat fraud on Zelle, but online fraud might be too big for even the nation's biggest banks to fight.

A New York judge refused to dismiss Attorney General Letitia James's suit accusing Zelle's operator of enabling more than $1 billion in scams.

Only 13% of scams reach federal agencies. The rest land at banks and payment apps, making them the country's de facto scam-reporting system.

The class action is an early test of whether credit unions can hold their vendors liable for the cybersecurity they promise.

Two former mid-level employees at the Toronto-based bank received U.S. prison sentences for their roles in funneling nearly half a billion dollars through TD accounts.

A Florida ring drilled its check-fraud recruits to dodge bank alerts. An analyst says the fraudsters were guarding the wrong door.

Bank7 CEO Tom Travis told analysts the court-ordered auction for a 71% stake in Century Bank should open in August.

One of Sweden's biggest banks agreed to the penalty to resolve a multiyear investigation into its compliance failures. The New York State Department of Financial Services said Swedbank intentionally withheld information it was required to turn over.

JPMorgan has a habit of taking its former private client advisors to court and accusing them of trying to steal clients they met through bank referrals. An industry recruiter says such suits aren't necessarily a sign of recruiting deals gone bad.

The volume of bankruptcy filings has been climbing, particularly among small businesses. But analysts note that the numbers are still below pre-pandemic levels.

The Denver-based bank reported that two loans soured, one due to fraud. A number of other lenders reported sizable fraud-related losses last fall.

U.S. Bank, Arvest, Old National, BMO and WaFd took the losses in a decade-long scheme the DOJ announced.

Brooke Pilant, who was at Ameriprise from 2017 to 2024, accused the firm of turning against her after she raised concerns about "unethical practices."

A federal judge has put on hold a plan for mass layoffs at the Consumer Financial Protection Bureau until a new, permanent director is confirmed by the Senate. The judge's order ratifies an agreement on the issue between the CFPB and its union.

The Office of the Comptroller of the Currency and Federal Deposit Insurance Corp. encouraged banks to heed Fincen guidance expanding the PATRIOT Act's safe harbor for voluntary information sharing between banks to combat fraud.

The Consumer Financial Protection Bureau is preparing to request information from credit-card issuers about their late fees. The renewed interest in late fees is a surprise, given the agency last year sided with the banking industry to kill a Biden-era rule that would have dropped the charges from $32 to $8.