Customer sues TD Bank after losing $300,000 in a cyber crime

CAMDEN - A Philadelphia-area firm has sued TD Bank N.A, claiming the financial institution failed to protect it from an online theft of more than $275,000.

Moore Capital Holdings LLC of Bryn Mawr, Pa., contends the Cherry Hill-based bank "did nothing" to recover funds stolen from its TD account in an elaborate scam.

In fact, the lawsuit contends, "TD Bank let the criminal steal another $100,000" after Moore Capital initially reported two fraudulent wire transfers of more than $180,000.

TD Bank does not comment on pending litigation, a spokesman said Wednesday.

The lawsuit accuses TD Bank of a "total and systemic failure to respond to perhaps the most prevalent form of cyber-crime today."

It says Moore Capital, which buys and manages real estate, was victimized in April when an employee tried to establish an account profile for the firm's TD eTreasury account, a business banking service.

The employee clicked a link "on what appeared to be TD Bank’s login page," the lawsuit says.

The link led to a fake website that resembled the TD page "in every respect except for one altered letter in the domain address."

After the worker entered his credentials and a phone number, he received a call from a man claiming to be a TD employee. A caller ID system said the call appeared to be coming from "TD Bank."

A second Moore Capital employee followed the caller's directions to enter their account credentials at the fake website.

The caller then said the account would be activated in about 15 minutes, a message repeated by a dialogue box on the Moore employee's computer screen.

A few minutes later, Moore Capital "suddenly lost all Internet access across all office work stations," the suit says.

About the same time, the firm's principal, Zachary Moore "noticed on his phone that he had received wire transfer alerts via email (from TD)," the suit says.

The first alert, at 12:37 p.m., said about $90,000 had been transferred to a JP Morgan Chase account for Fatali LLC.

A second alert five minutes later showed more than $94,000 had been wired to a Bank of America account for a firm called MOJ EB LLC.

"Moore knew immediately that the transactions were fraudulent," the suit says.

The alerts told Moore to direct any questions to his nearest TD branch or a toll-free number.

But the suit describes the toll-free number as "just a general services line that funneled Moore into an automated answering system."

It says Moore hung up and reported the fraudulent transfers in a call to a branch office "at approximately 12:47 p.m.," or some 10 minutes after receiving the first alert.

The suit contends Moore's account was not frozen for 20 minutes — and that a third fraudulent transfer sent $91,450 to a Wells Fargo account during that period.

The recipient of the third transfer was identified as EJM Brothers Inc., says the suit, which notes all of the funds were later transferred out of the receiving banks.

It alleges TD's "inexplicable ineptitude, delay and lack of preparedness" thwarted Moore Capital's independent efforts to reclaim its money with help from the FBI and the banks that received the transfers.

"To date, (Moore Capital) has recovered none of the wired funds," says the suit, which was filed Tuesday in Camden federal court.

It also claims no fraud investigator from TD Bank has contacted Moore Capital.

"It therefore appears that while TD Bank instructs customers to report fraud, the

reporting serves no purpose," the lawsuit claims.

The lawsuit, filed by attorney Jordan Rand of Philadelphia, seeks to recover Moore Capital's losses, including its expenses in trying to reclaim the stolen money.

It also demands treble damages for alleged violations of New Jersey's Consumer Fraud Act, claiming the bank falsely advertised a fraud response program and misrepresented its actions after the wire transfers.

The suit also says TD "never recommended contacting the FBI" about the incident. noting Moore Capital went to the federal law enforcement agency at the recommendation of its attorney.

The FBI earlier this year reported so-called "business email compromise schemes" were the costliest of cyber crimes in 2020, when almost 20,000 complaints represented an adjusted loss of some $1.8 billion.

It urged victims to report cyber crimes to the FBI's Internet Crime Complaint Center, noting that helps investigators arrest criminals, understand their tactics and mitigate losses from their scams.