New York Attorney General Letitia James sued the operator of the Zelle payments network on Wednesday, alleging it enabled fraud by allowing scammers to steal over $1 billion from users between 2017 and 2023.

James’ office said in a press release that its investigation found that Early Warning Services, the owner and designer of the peer-to-peer money transfer company, designed Zelle “without critical safety features.” The release noted that the lawsuit against EWS follows a similar one dropped by the Consumer Financial Protection Bureau in March.

“EWS knew from the beginning that key features of the Zelle network made it uniquely susceptible to fraud, and yet it failed to adopt basic safeguards to address these glaring flaws or enforce any meaningful anti-fraud rules on its partner banks,” James’ office said in the release.

The lawsuit alleges that Zelle became a “hub for fraudulent activity” because the registration process lacked verification steps and that EWS and its partner banks knew “for years” that fraud was spreading and did not take actionable steps to resolve it, according to the press release.

James is seeking restitution and damages, in addition to a court order mandating that Zelle puts anti-fraud measures in place.

“No one should be left to fend for themselves after falling victim to a scam,” James said in the release. “I look forward to getting justice for the New Yorkers who suffered because of Zelle’s security failures.”

In a statement, a Zelle spokesperson called the lawsuit a “political stunt to generate press” and a “copycat” of the CFPB lawsuit.

“Despite the Attorney General’s assertions, they did not conduct an investigation of Zelle,” the spokesperson said. “Had they conducted an investigation, they would have learned that more than 99.95 percent of all Zelle transactions are completed without any report of scam or fraud — which leads the industry.”

The CFPB in December sued EWS and JPMorgan Chase, Bank of America and Wells Fargo — the three U.S. banks that dominate transactions on Zelle — alleging the companies failed to investigate fraud or offer reimbursement to users.

The regulator dropped its suit amid a growing number of cases it has dismissed under acting CFPB Director Russell Vought.