A Massachusetts appellate panel on April 18, 2025, brought to a close a bizarre dispute in which customer Lourenco Garcia sought to hold Santander Bank liable for $751,000 he lost to a crypto scam.
The court ruled that neither the bank’s customer agreement nor state law obligates Santander to block or flag customer‑authorized transfers, even where fraud is rampant.
Santander Bank Wins a Rather Unconventional Crypto Lawsuit
Between December 2021 and January 2022, Garcia used his checking and savings accounts to make two debit‑card purchases and seven wire transfers to Metropolitan Commercial Bank of New York.
Those funds were then used to purchase cryptocurrency on Crypto.com and a purported platform called CoinEgg. Garcia later learned CoinEgg was a scam. So, his entire $751,000 had vanished.
He sued Santander for breach of contract, negligent misrepresentation, and violation of Massachusetts consumer‑protection law. The argument was that the bank should have spotted and stopped the high‑risk transactions.
However, the appeals court rejected each claim. It noted the customer agreement states Santander “may” intervene when it suspects fraud, but imposes no duty to do so.
Also, state regulators have not created a legal obligation for banks to police every transaction.
Meanwhile, the victim claims that Santander’s website promises to “contact a customer” about suspicious activity failed to create binding duties.
Yet, the bank wouldn’t have this liability since Garcia himself authorized all transfers and never raised concerns until after his loss.
While the unpublished decision carries limited precedential weight, it sends a clear message: banks are not insurers against personal investment losses.
At a time when crypto scams are surging and regulatory levies are increasing, institutions will rely on precise contractual language to define their responsibilities.
Therefore, customers must adopt due diligence and fraud‑protection measures when moving six‑figure sums into high‑risk digital assets.
Overall, it looks like Garcia’s two-year effort to recover his funds ended in misfortune. He filed the original complaint in October 2022.
With both the Superior Court and appellate court siding with Santander, this legal saga concludes as an instructive footnote on the limits of bank liability in customer‑initiated crypto transactions.
