An 86-year-old client of Merrill Lynch, UBS Financial and TD Bank is suing the firms, alleging they failed to protect her from an elder fraud scheme that depleted her accounts.
According to the complaint, filed in the Supreme Court of the State of New York in New York County — a trial court — Nina Mortellito is a retiree who held her life savings at the three financial institutions.
In 2022, Mortellito named Vail Maes, her niece, as trustee at each of the institutions as her capacities diminished. "Each Defendant was on prior notice" that Mortellito had a prior elder fraud incident in 2021, resulting in her adding Maes, according to the complaint.
Maes was added as co-trustee on accounts held with Merrill, UBS and TD Bank or executed powers of attorney, steps that collectively placed all three institutions on notice that the 86-year-old "required elevated protections and monitoring to avoid recurrence of elder financial fraud," the suit contends.
Mortellito, the suit states, "clearly was the victim of an elder fraud scheme beginning in or around August 2023, when a malicious pop-up window appeared on her personal computer falsely warning her of imminent hacking of her accounts."
The fraudsters persuaded Mortellito to withdraw and transfer funds, according to the complaint.
Beginning in or about April 2022, monthly account statements for the relevant Merrill account listed both Mortellito and Maes as trustees.
On Oct. 23, 2023, Mortellito withdrew $60,000 from her Merrill account. This was followed by withdrawals of $100,000 on March 14, 2024, and $125,000 on April 11, 2024.
"These large, rapid, and unprecedented transactions were completely inconsistent with Plaintiff's historical withdrawal pattern, which had never exceeded $5,000.00," the suit states. "Fraudsters persuaded Plaintiff to make these transfers to convert her assets into gold and to wire them for supposed safekeeping."
UBS, according to the suit, served as investment advisor and custodian of Mortellito's assets for more than 20 years.
Withdrawals at UBS, according to the suit, "were primarily conducted through account closure requests and direct wire transfers authorized during phone interactions."
On Nov. 17, 2023, plaintiff authorized a withdrawal of $25,000, followed by $30,000 on Feb. 1, 2024, and another $50,000 on March 18, 2024. She withdrew another $25,000 on April 18, 2024 and $10,301 on May 8.
Merrill Lynch and UBS declined to comment on the suit.
"These withdrawals came after more than two decades of consistent, conservative investment activity," according to the suit.
As to TD Bank, the plaintiff's withdrawals were conducted both in person and through teller assistance, "which should have immediately raised an alarm given her age and prior history," the suit states.
"In November 2023, she withdrew $60,000 in cash in a single transaction," the suit continues. "In February 2024, she issued a check in the amount of $30,000 to a third party, Grace M. Vargo, who had no prior association with her account. In March 2024, she wired $150,000 to a bullion dealer in Texas. In May 2024, she made additional withdrawals totaling over $35,000."
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