Shapiro, P.A. v. Wells Fargo Bank, N.A.

352 F.Supp.3d 1226 (2018)

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Nature of the Case

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Facts

P had a client that needed to repay a loan, and P facilitated that transaction. The client forwarded P an email from the lender's lawyer, James Messenger, containing wire transfer instructions for repaying the loan. The email identified the bank as M&T Bank in Syracuse, New York. The next day, the client forwarded P another email purportedly from Messenger that directed repayment to a different account: a Wells Fargo account based in Texas. The message claimed that the prior bank is currently on audit and as a result can't receive funds for now. P did not email or speak to Messenger. Despite the five typographical and capitalization errors in the second email, P chose to rely on it because it was more recent. P initiated the wire transfer to the Wells Fargo account. .Messenger never received the funds, because the Wells Fargo account did not belong to him. It belonged to Chris Achebe, who promptly removed the funds from the account. P sent Wells Fargo a recall request, but Wells Fargo denied it because the funds were already gone. D uses MTS for wire transfers. MTS creates an automated audit trail that documents the various automated steps in the process. The automated audit trail included an entry that reads, 'possible name mismatch in CDT party.' This possible name mismatch entry was not seen by anybody at Wells Fargo. Possible name mismatch entries are common in wire transfers. The wire transfer included the partial word 'ATTORN.' This triggered D's Office of Foreign Asset Control (OFAC) to review the transfer for possible United States sanctions violations because of the similarity of 'ATTORN' to 'ATTOUN,' a name that appears on the sanctions list. The person who reviewed the details determined that there was no match between 'ATTORN' and 'ATTOUN.' The OFAC does not deal with name mismatches. P sued D under 670.207, and one claim for negligence. D moved for summary judgment. P argues that D knew about the mismatch because it opened the receiving account in Chris Achebe's name and the automated audit trail identified a possible name mismatch.