CFPB Sues JPMorgan Chase, Bank of America, and Wells Fargo
On December 20, 2024, the Consumer Financial Protection Bureau (“CFPB”) announced that it has sued the operator of Zelle and three of the nation’s largest banks for failing to protect consumers from widespread fraud on America’s most widely available peer-to-peer payment network.
Early Warning Services, which operates Zelle, along with three of its owner banks—Bank of America, JPMorgan Chase, and Wells Fargo—rushed the network to market to compete against growing payment apps such as Venmo and CashApp, without implementing effective consumer safeguards.
Customers of the three banks named in the lawsuit have lost more than $870 million over the network’s seven-year existence due to these failures. The CFPB’s lawsuit describes how hundreds of thousands of consumers filed fraud complaints and were largely denied assistance, with some being told to contact the fraudsters directly to recover their money.
According to the CFPB, Bank of America, JPMorgan Chase, and Wells Fargo also allegedly failed to properly investigate complaints or provide consumers with legally required reimbursement for fraud and errors.
The CFPB is seeking to stop the alleged unlawful practices, secure redress and penalties, and obtain other relief.
For additional details, please CLICK HERE.
Source: Consumerfinance.gov
