Powis Parker, Inc. v. Truist Bank
6:22-cv-01269
M.D. Fla.Mar 5, 2024Background
- Plaintiff Powis Parker, Inc.’s finance manager’s email was hacked in early 2022, leading to a fraudster instructing a customer (Formatic GmbH) to wire $245,000 to a Truist Bank account that did not actually belong to Powis Parker.
- The account receiving the funds was held in the name of Gen Script USA, Inc., not Powis Parker, and controlled by Lucy Herring.
- Truist’s processing system, MTS, relied on a matching account number and did not flag the beneficiary name mismatch; a manual OFAC review did not identify the beneficiary discrepancy.
- By the time Truist was alerted to the fraud and a reversal was requested, the funds had been withdrawn and the account balance was zero.
- Powis Parker sued under Florida’s codification of UCC Article 4A, alleging Truist should have rejected the wire due to the name/account mismatch; Truist moved for summary judgment.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Truist had actual knowledge of the beneficiary name/account mismatch during processing | Truist’s OFAC reviewer should have seen and acted on the mismatch | No individual at Truist had actual knowledge of the mismatch until weeks later | Court found no evidence of actual knowledge; summary judgment for Truist |
| Admissibility of Williams Declaration (Truist’s evidence of knowledge) | Should be excluded for lack of personal knowledge and foundation | Proper as a corporate representative’s review of business records | Court admitted Williams Declaration as competent evidence |
| Admissibility of Longstaff’s expert report on bank practices | Irrelevant since not used by Truist to support summary judgment | Responsive to Powis Parker’s arguments about due diligence in account opening | Court did not exclude report; found it addressed relevant issues |
| Whether Truist failed to exercise due diligence by relying on automated systems or in opening the account | Reliance on automation improper if original due diligence on account opening deficient | Automated processing is a reasonable routine; only knowledge at transaction time matters | Court held no breach of due diligence; summary judgment for Truist |
Key Cases Cited
- Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (1986) (standard for summary judgment: genuine dispute of material fact)
- Celotex Corp. v. Catrett, 477 U.S. 317 (1986) (burden-shifting framework on summary judgment)
- Evers v. Gen. Motors Corp., 770 F.2d 984 (11th Cir. 1985) (conclusory allegations insufficient to defeat summary judgment)
- Allen v. Bd. of Pub. Educ., 495 F.3d 1306 (11th Cir. 2007) (moving party's burden and favorable inferences to nonmoving party)