A crypto scam victim who lost $20 million in an elaborate romance fraud has expanded his legal battle, filing fresh lawsuits against two additional banks he claims enabled the theft. Michael Zidell, who previously sued Citibank, now accuses East West Bank and Cathay Bank of turning “a blind eye” to suspicious transactions involving his stolen funds.
How the crypto scam unfolded
The crypto scam victim detailed how a woman named “Carolyn Parker” contacted him on Facebook in early 2023, sparking a romantic relationship. Within a month, Parker allegedly boasted about making millions through NFT investments and persuaded Zidell to join a trading platform.
Over several months, Zidell transferred $20 million across 43 transactions to accounts at Citibank, East West Bank, and Cathay Bank. By April 2023, the platform vanished along with his life savings.
“Romance scam. Rug pull. Pig butchering. These are just some of the terms to describe the scam that befell the plaintiff,” the lawsuit states.
A highlighted excerpt of the complaint detailing the alleged fraud scheme. Source: PACER
Banks accused of aiding $20M fraud
The crypto scam victim claims East West Bank processed 18 transfers totaling nearly $7 million, while Cathay Bank handled 13 transfers exceeding $9.7 million. His lawsuit argues that both banks neglected their duty to monitor suspicious activity, allowing the fraud to continue unchecked.
“Defendants materially aided Parker and her co-conspirators by providing services including wire transfers,” the complaint alleges.
It further states that the banks should have flagged the large, round-number transactions as suspicious.
Elder abuse allegations surface
In a new legal twist, Zidell accuses East West Bank and Cathay Bank of “aiding and abetting elder abuse.” While his age isn’t specified, California law defines elders as those 65 and older. This claim wasn’t included in his earlier case against Citibank.
A highlighted excerpt of the complaint claims Zidell sent the allegedly fraudulent platform, OpenrarityPro, over $20 million. Source: CourtListener
The crypto scam victim is seeking compensatory damages, legal costs, and interest in a jury trial. His legal team argues the banks’ negligence allowed scammers to exploit vulnerable individuals.
A growing trend of crypto fraud
Zidell’s case highlights the rising threat of crypto scam victims falling prey to sophisticated fraud schemes. Known as “pig butchering,” these scams often involve fake romantic relationships to lure victims into fraudulent investments.
Financial institutions face increasing scrutiny over their role in preventing such crimes. Experts say banks must enhance fraud detection systems, especially for high-value transactions involving crypto-related activities.
Legal analysts suggest Zidell’s case could set a precedent for holding banks accountable in crypto fraud cases. If successful, it may prompt financial institutions to tighten their anti-fraud measures, potentially protecting future victims of crypto scams.
Meanwhile, East West Bank and Cathay Bank have yet to publicly respond to the allegations. Cointelegraph reached out for comment but received no immediate reply.
Olivia Jackson is a US-based cryptocurrency writer and market analyst with a passion for decoding the complexities of blockchain technology and digital assets. With over five years of experience covering the crypto space, she specializes in breaking down market trends, regulatory developments, and emerging Web3 innovations for both retail and institutional audiences.
Her work has appeared in leading finance and tech publications, including CoinDesk, Decrypt, and The Block, where she provides data-driven insights on Bitcoin, DeFi, and the evolving regulatory landscape. Olivia is particularly interested in the intersection of traditional finance and decentralized systems, often exploring how macroeconomic shifts impact crypto markets.
