Court Allows Fraud Action Brought By Langer Grogan & Diver, P.C. to Proceed Against Zions First National Bank

News provided by

Sep 10, 2015, 04:19 ET

PHILADELPHIA, Sept. 10, 2015 /PRNewswire/ -- The United States Court of Appeals for the Third Circuit has breathed new life into a major case against Zions First National Bank, a subsidiary of Zions Bancorp (NASDAQ: ZION), for its alleged involvement in a scheme to defraud hundreds of thousands of depositors throughout the United States. The case was brought on behalf of the depositors by the Philadelphia law firm, Langer, Grogan & Diver, P.C.

The Court vacated a lower court's determination that the case could not proceed as a class action on behalf of all of the harmed depositors. The Court cited internal Zions documents and quoted the conclusions of an expert for the plaintiffs that Zions, "'allowed the system to be used by High Risk originators whom it had to know were engaged in fraud in clear disregard of the governing rules and standards, ... made knowing misrepresentations to the other participants in the ACH [automated clearing house] system, ... facilitated the misuse of the system, and ... did all this knowing of facts from which, as a banking institution, it had to know fraud was taking place.'"

"We look forward to pressing ahead," said Peter Leckman, an attorney at Langer Grogan & Diver. Howard Langer, the lead attorney on the case, stated, "courts do not tolerate procedural efforts to block redress for those seeking to hold companies profiting from fraud accountable."

Damages in the case have been estimated to be in excess of $50 million and are trebled under the federal RICO Act.

The case is Reyes v. Netdeposit, et al., 14-1228, in the U.S. Court of Appeals for the Third Circuit.

Langer, Grogan & Diver, P.C. (LGD), is a nationally recognized complex commercial litigation law firm based in Philadelphia, Pennsylvania. LGD obtained one of the largest ever consumer class action recoveries when it reclaimed over $150 million dollars from Wachovia Bank on behalf of victims of telemarketing fraud. For more information, visit the firm's website at www.langergrogan.com.

SOURCE Langer, Grogan & Diver, P.C.