CFPB Chimes in on Alleged Remittance Transfer Falsehoods

  • The CFPB issued a consent order against fintech company Chime, Inc. d/b/a Sendwave to resolve allegations that it violated the Electronic Fund Transfer Act and related regulations, as well as the Consumer Protection Act of 2010, by deceiving consumers about the speed and cost of its international money transfer services—“remittance transfers”—through its mobile app, Sendwave.
  • According to the consent order, Sendwave allegedly falsely advertised that it allows funds to be delivered “instantly” and “with no fees,” when transfers actually took much longer and consumers were charged fees, among other allegations.
  • Under the terms of the consent order, Sendwave must pay a $1.5 million penalty to the CFPB, provide approximately $1.5 million in consumer redress, and cease its deceptive advertising practices, among other relief.
  • Earlier this summer, Cozen O’Connor State AG Group attorneys Siran Faulders and Keturah Taylor provided a deeper analysis of the regulatory risks that payment apps face.