A bank customer sued his bank for violations of the Electronic Fund Transfer Act (EFTA), the Uniform Commercial Code (UCC), and breach of contract after three unauthorized wire transfers totaling $161,200 were made from his account. The bank recovered $28,000 of the transfers but failed to recover the remaining $133,000. The customer sued the bank for the unrecovered amount. The dispute was referred to arbitration, where the arbitrator found in favor of the bank, holding that wire transfers are excluded from EFTA coverage. Following arbitration, the bank filed a petition to confirm the award, which the customer opposed, arguing that the arbitrator manifested a “disregard of the law.” However, the customer then failed to explain what law the arbitrator allegedly disregarded.
In Bhuya v. Citibank, N.A., No. CV 22-6006 (AMD)(AYS), 2024 WL 3256723, 2024 U.S. Dist. LEXIS 101179 (E.D.N.Y. June 6, 2024) (opinion not yet released for publication) the court found no basis for vacating the arbitration award and granted confirmation of the award in the bank’s favor. The court analyzed the plaintiff's claims and objections to the arbitration award by examining the arbitrator's interpretation of the law and the procedural fairness of the arbitration. It upheld the arbitrator's finding that wire transfers are expressly excluded from the EFTA under 12 C.F.R. § 1005.3(c)(3); thus, the claims were not covered by the statute. The court rejected the plaintiff's argument that the arbitrator manifestly disregarded the law, noting that the arbitrator had explicitly considered and correctly applied the relevant legal principles. Accordingly, the court upheld the arbitration award.
By Maycee Redfearn: [email protected]
Edited By Ashley Boyce: [email protected]
Edited By Hayden Mariott: [email protected]