Citibank is facing a lawsuit from a man who claims to be the victim of a $20 million cryptocurrency romance scam, accusing the bank of overlooking clear warning signs that enabled the fraud.
Filed in Manhattan federal court on Tuesday, the suit by Michael Zidell alleges that Citibank “turned a blind eye to its statutory duties and obligations” by allowing him to funnel millions of dollars to scammers with accounts at the bank.
According to Zidell, he transferred a total of $20 million to the fraudsters through numerous transactions involving several banks—nearly $4 million of which went to Citibank accounts.
The complaint describes the scheme as a classic “pig butchering” scam, where con artists create fake online romantic relationships to manipulate victims into investing in bogus cryptocurrency ventures.
Facebook Romance Scam Led to Fraudulent NFT Investments
Zidell said the scam began in early 2023 when he was approached on Facebook by someone identifying herself as “Carolyn Parker,” who claimed to be a business owner. Their interaction started as a friendly, social connection but soon evolved into what Zidell believed was a budding romantic relationship.
About a month into their conversations, Parker encouraged Zidell to invest in non-fungible tokens (NFTs), claiming she had made millions through such investments. She then directed him to a trading platform she allegedly used.
Trusting her advice, Zidell began investing in NFTs, transferring funds to a series of bank accounts provided by the platform. He was told that the use of multiple banks was necessary due to the high volume of customer transactions.
Zidell said that over the following months, he made 43 transfers totaling more than $20 million to various bank accounts. However, by late April, the trading platform’s website suddenly vanished—along with all of his invested funds.
Lawsuit Alleges Citibank Overlooked Scam Red Flags
The lawsuit claims Citibank facilitated 12 transfers totaling approximately $4 million to a company called Guju Inc., and accuses the bank of failing to act on clear signs of suspicious activity.
According to the complaint, Citibank ignored several red flags associated with Guju’s accounts, including the movement of large, round sums of money—an indicator that should have prompted a closer investigation.
The filing further alleges that Citibank “failed to implement adequate security measures, failed to detect clearly suspicious transactions, and failed to monitor the accounts,” despite the questionable pattern of funds being transferred in and out by trusts and various individuals.
Zidell accuses the bank of negligence and claims it aided and abetted the scam, arguing that Citibank had a duty to exercise due care in identifying and addressing suspicious financial activity.
Romance Scams Cost Victims Billions Each Year
According to cybersecurity firm Cyvers, romance scammers stole more than $5.5 billion in 2024 across 200,000 reported cases.
In February, blockchain analytics firm Chainalysis estimated that crypto scams of all kinds stole approximately $9.9 billion in 2024—a figure that could climb to $12.4 billion as more scam-linked wallets are uncovered.
Earlier this month, U.S. authorities announced the seizure of $225 million connected to pig butchering scams in a Secret Service-led operation, marking the agency’s largest-ever crypto seizure.
