Billion-Dollar Bank Allegedly Loses $15,500,000 To Criminals in ‘Shocking’ Display of Incompetence and Negligence: Report

A New York-based bank is reportedly facing a new lawsuit after thieves allegedly looted $15.5 million from an account that belonged to a public utility firm.

Garden City Park Water and Fire is suing First National Bank of Long Island for gross negligence amid allegations that the lender acted with “reckless disregard” and without the “exercise of even slight care and slight diligence,” reports the New York Post.

The public utility firm, which provides potable water, emergency services and fire protection to the Garden City District in New York, says a scammer posing as a company employee emailed the bank in July requesting authorization forms for new international and domestic wire transfers.

According to the suit, the thieves sent back the forms with “blatant” forged signatures, and the bank green-lighted the request after “blindly” accepting the fraudulent authorizations.

Three days after getting the go signal, the thieves drained 85% of the funds held in Garden City Park Water and Fire’s account in just four hours, moving the money to a number of accounts based in the US, China and Mexico. The thieves made a total of 15 transfers – 10 of which surpassed the bank’s daily transfer limit of $2 million.

Garden City Park Water and Fire says First National Bank of Long Island showed “shocking incompetence and negligence” following its compliance with the scammers’ request.

In a joint statement, lead counsel Jon Ward and the public utility firm’s co-managing member Sahn Ward Braff Coschignano say that what happened was “every bank customer’s nightmare.”

“The District relied on their bank to protect the security and integrity of its deposits, and First National Bank of Long Island failed. Now, we are asking the Court to hold First National Bank of Long Island accountable for its failure.”

Meanwhile, First National Bank of Long Island is shifting the blame to Garden City Park Water and Fire. The bank’s attorney, Tanweer Ansari, says an internal investigation revealed that the theft happened because “of unauthorized access to banking information within the customer’s control” and that the lender had taken “reasonable procedures.”

Authorities have since recouped $4.4 million of the stolen funds, leaving First National Bank of Long Island accountable for $11.1 million.

First National Bank of Long Island merged with ConnectOne Bank in September of 2024 and is now operating under the ConnectOne brand. The bank manages about $14 billion in total assets.

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