Retired vet lost millions to fraud, family says. Would stronger laws have protected him?

TACOMA — A South Hill woman’s uncle lost millions in an alleged financial scam before his death.

Stymied in the courts to hold someone accountable, she’s now recounting his story publicly to warn people with relatives dealing with dementia or other neurological issues about the danger of phishing schemes and other financial fraud. She also hopes to inspire changes in the law to get better protections for seniors.

Janine Satterfield filed a negligence lawsuit in January in U.S. District Court for the Eastern District of Virginia against Wells Fargo and Navy Federal Credit Union, which both served her uncle, retired U.S. Navy veteran Larry Cook.

Cook was a Fairfax County, Virginia, resident who died April 21, 2021 after a string of wire transfers sent to pay an alleged “loan repayment” scheme overseas.

Last month, U.S. District Judge Claude Hilton dismissed the case, citing among other things, Virginia state law regarding wire transfers.

“While a bank can be liable under Section 212 for not accepting a payment order, no provision of Section 8.4A imposes liability on a receiving bank that properly executes a duly authorized wire transfer by the sender,” the judge wrote.

Satterfield’s case argued that the financial institutions should have done more, primarily stopping the transfers for what Cook thought were repayments, she explained to The News Tribune in a recent interview.

She first discovered the wired payments as she sought information to help with his burial.

“All different names, all different parts of Thailand, all different addresses. Like one was on an alleyway behind the temple — that was an address,” she said, describing how the transfers were made out. “I mean, the guy’s got millions of dollars with your bank and your credit union. Millions of dollars!”

She recounted questions that bank or credit union employees could have asked:”Who are you paying? What did you borrow? You borrowed from somebody in Thailand? Really? What did you buy?”

“If they just would have asked the questions …,” she added before trailing off.

Navy Federal Credit Union, in a response to questions from The News Tribune, said Thursday, “Our members are always our first priority and we handle all member transactions with great care.”

It added, “Out of respect for the decision of the court, we have no further comment.”

Wells Fargo, in an emailed statement, said that it “takes financial exploitation very seriously. We are committed to helping our customers avoid fraud and scams through various resources, including ongoing education efforts.”

The email included a link to Wells Fargo’s “Protecting those you love” brochure.

Northwest ties

Cook’s ties to the Northwest include not only Satterfield but his life before embarking on a naval career where he became a decorated Navy commander and nuclear submarine officer and later consultant.

He studied at Edison Technical School in Seattle before enrolling at the University of Washington, where he earned his bachelor of science degree in 1968. He was commissioned as an officer in the U.S. Navy in 1968 and retired as a commander in 1992.

According to court filings, he worked with consulting firm Booz Allen Hamilton starting in 1993, then Zimmerman Associates, Inc., which offers program management and engineering services for the Navy.

The complaint filed with the court listed his estimated net worth at “approximately $8 million to $10 million.”

Satterfield said her uncle lived a insular life mostly away from his relatives.

“All of us are on the West Coast. He was not a family picnic kind of guy. He was a very private guy,” she said. “I don’t even think he dated. He never had a pet. He … was just completely committed to the military, and the research and the development of everything that he was privy to as a consultant at the nuclear level propulsion level for submarines.”

His mother died in 2019 in Santa, Clara, California, age 101, and he’d managed her assets, including a trust set up to pay his mother’s debts and taxes.

Cook also managed two rental properties in Washington state, according to the filing.

The complaint states, “From a cognitive perspective, Mr. Cook was highly intelligent and managed his affairs, including his finances, very well before his health declined, due to a stroke in 2019.”

The filing describes him not seeking medical attention for more than 14 hours after the initial stroke in mid-July of that year.

“Mr. Cook had attempted to drive himself to his primary care physician, but had a minor motor vehicle accident on the way,” it stated.

“He was not OK, by any standard,” Satterfield told The News Tribune.

The filing recounts a dismal personal timeline. Cook was forced to retire, tax filings for himself, his mother and the family trust weren’t filed, and communication, what little had preceded the stroke, pretty much stopped, including with the attorney tied to the family trust.

It was a perfect storm for even more issues to emerge before he died in 2021.

Phishing followed by ‘loan repayment’

A phishing email, the court case states, was how the fraud started.

The court record describes that on Oct. 5, 2020, an unsolicited email “from, what appeared, the company ‘Amazon’, informing him of his recent purchase of an iPad and even providing instructions for whom to call with questions regarding this recent purchase.”

“He was falling prey to a very elaborate, and fraudulent, scam, a scam which NFCU later warned its customers about in a December 3, 2020, customer alert titled ‘Fake calls from Apple and Amazon support: What you need to know,’” the filing states.

The filing continues: “On October 6, 2020, after receipt of the fraudulent email, Mr. Cook sent out the first wire, from his NFCU checking account to a stated individual with an account at Standard Chartered in Singapore. This wire was made in person at the Vienna, Virginia NFCU branch.”

Between Oct. 6, 2020, through April 20, 2021, one day before his death, “Mr. Cook sent out a total of 75 international wire transfers,” the complaint states.

Nearly all the transfers were just under $50,000, with a stated purpose of “loan repayment.”

The bulk of the transfers were sent through NFCU; with only one successfully sent through Wells Fargo.

The complaint notes that an NFCU representative, in mid-December 2020, “reported Mr. Cook to Fairfax County Adult Protective Services, for what was described as ‘incoming wires and outgoing wires … conducted in a manner indicative of possible elder financial exploitation.”

NFCU said in its motion requesting dismissal of the case, “Because the nature of the relationship between Cook and Navy Federal was strictly one of customer and depository bank governed by contract, Navy Federal had no duty to monitor Cook’s account, oversee how he used his money, or protect him from the alleged criminal acts of a third party.”

It added, “Navy Federal is a credit union in the business of providing banking services, not a guardian charged with overseeing how deposit customers use their money. Navy Federal processed the wires in direct compliance with Cook’s instructions.”

The credit union’s court filing noted that while it did try to intercede with its reporting to Adult Protective Services for further investigation, “Various federal and state statutes insulate Navy Federal from liability for this reporting, and the investigation was closed after Cook refused to cooperate with APS.” One of its exhibits noted Cook yelled at APS workers, telling them he was “spending the money the way he wanted to.”

“Navy Federal … processed the transactions Cook initiated, the money belonged to Cook and was his money to transfer, and Navy Federal is not liable under any of Plaintiff’s theories,” the credit union’s filing stated.

Wells Fargo’s court filing followed similar arguments supporting dismissal of the case, stating it “carried out the transaction Mr. Cook initiated, the money belonged to Mr. Cook and was his money to transfer, and no liability whatsoever should attach to Wells Fargo.”

It added, “Virginia does not recognize a stand-alone claim for breach of the covenant of good faith and fair dealing. Likewise, to the extent that Plaintiff seeks to assert a common law claim for said breach against Wells Fargo, it would be preempted by the UCC and barred by the economic loss doctrine.”

The “UCC” stands for the Uniform Commercial Code, a uniform law that governs commercial transactions.

The judge in the case agreed with the motions to dismiss.

The aftermath and what’s next

USA TODAY, which also covered this case, noted that in 2022, more than a year after Cook’s death, Virginia strengthened its reporting laws, allowing financial-institution staff to delay or refuse to disburse and execute transfers if they suspect exploitation.

The USA TODAY report also noted that according to the Consumer Financial Protection Bureau, in 2020 financial institutions filed more than 62,000 reports involving elder financial exploitation worth $3.4 billion.

Back in the Pacific Northwest, drilling down to how much money seniors in Washington state lose to wire scams in particular is unclear.

Cindy Fazio, director of Consumer Services for Washington State Department of Financial Institutions, told The News Tribune in response to questions, “I am not aware of any data compilation on wire transfer fraud for Washington.”

Lyn Peters, director of communications for DFI, told The News Tribune via email, “Wires are high risk, no matter what jurisdiction they are made from/to. Wires are one of the easiest ways to scam given that the ability to recall a wire is so limited.”

Peters explained, “The federal Senior Safe Act makes reporting a transaction suspected to be fraudulent transactions/financial abuse of a vulnerable senior adult permissible — though not mandatory — in all 50 states and protects the employees who make the report from being sued for reporting it.”

Satterfield, in her interview with The News Tribune, took issue with how the case played out.

“I’m a financial services employee,” she said, “We do have laws that if we suspect as an advisor, that somebody is being exploited either by a family member … or a caregiver or somebody comes in and they want to add people to accounts.”

She pointed to the oversight of bank accounts and credit-card accounts that help to recoup losses through fraud.

The Virginia case showed how things can quickly go sideways with wires and a person determined to make the transfers, she noted. Lawmakers, she maintained, need to act.

“This is a huge issue with dementia coming down the pipe with concussions, with (brain fog from) chemo, with all of these things that impact our thinking — even just diabetes,” she said, which the court records indicated Cook also had, among other medical issues.

“If you haven’t eaten, you may not be thinking clearly,” she said.

For now, she said, “we’re in the process of appealing.”

Though it didn’t work out in Cook’s case, Peters of DFI recommended getting Adult Protective Services involved “and get an assessment and to have the senior in question deemed incompetent to manage their own finances — something many if not most families are not willing to do.”

“I am told that pretty frequently, our banks refer scenarios to APS when they believe someone is being exploited. We often get consumer complaints when the bank restricts access to an account due to referring it over to APS,” Peters wrote. “Those are sticky situations.”

Peters added, “In one instance I’ve been working to get assistance and resources for, the daughter got an emergency conservatorship and is working on a permanent conservatorship to stop the flow of funds to the scammers, but this brought even more expense to the family in the form of attorney’s fees — something that, again, most families either can’t or don’t want to deal with.”

Satterfield’s advice for those with far-flung relatives who may not be used to, or want, regular check-ins:

“Until the laws are in our favor, until some action is taken at the federal level … we kind of have to get into each other’s business.”

For more information

• Washington State Attorney General Senior Fraud information: atg.wa.gov/senior-fraud
• Consumer Financial Protection Bureau: How to prevent and report scams targeting older adults: consumerfinance.gov/about-us/blog/how-to-prevent-and-report-scams-targeting-older-adults/