Consumer Financial Protection Bureau lawsuit overview:
- Who: The Consumer Financial Protection Bureau filed a lawsuit against Zelle’s operator and three of the nation’s largest banks.
- Why: The CFPB alleges the banks failed to protect their customers from fraud on the Zelle platform.
- Where: The Consumer Financial Protection Bureau lawsuit was filed in a California federal court.
The Consumer Financial Protection Bureau filed a lawsuit against Zelle’s operator and three of the nation’s largest banks—Bank of America, JPMorgan Chase and Wells Fargo—alleging they failed to protect consumers from rampant fraud on the peer-to-peer payment platform.
The CFPB filed the lawsuit against Early Warning Services and the banks Dec. 20 in a California federal court and announced the move in a press release.
Bank of America, JPMorgan Chase and Wells Fargo jointly own Early Warning Services alongside other major financial institutions. Zelle allows users to send money instantly using email addresses or mobile numbers, but the CFPB alleges its rapid transfer system and token-based features leave consumers particularly vulnerable to scams and Zelle fraud.
According to the Consumer Financial Protection Bureau lawsuit, the companies rushed Zelle to market without implementing proper safeguards, resulting in customer losses exceeding $870 million since its launch in 2017.
“The nation’s largest banks felt threatened by competing payment apps so they rushed to put out Zelle,” CFPB Director Rohit Chopra says. “By their failing to put in place proper safeguards, Zelle became a gold mine for fraudsters, while often leaving victims to fend for themselves.”
The CFPB alleges Zelle’s limited identity verification processes and failure to share fraud-related data among member banks created a haven for scammers.
It says fraudsters exploited Zelle’s design to reroute payments to their accounts and carried out repeated schemes across multiple institutions with little resistance. The CFPB also alleges the banks failed to investigate fraud complaints adequately or reimburse victims in violation of federal law.
CFPB says banks ignored multiple warnings of rampant fraud
Early Warning Services and the banks allegedly ignored red flags raised by hundreds of thousands of consumer complaints and failed to enforce Zelle network rules that mandate timely reporting of fraud incidents, the Zelle fraud lawsuit claims. In many cases, Zell reportedly advised customers to contact fraudsters directly to recover lost funds.
The CFPB seeks to halt the alleged misconduct, secure restitution for Zelle fraud victims and impose penalties on the banks.
“Companies need to take responsibility for the arbitration agreements they impose and the safeguards they promise,” Chopra says.
In 2022, bank customers filed a slew of class action lawsuits against Capital One, Bank of America, Wells Fargo, Navy Federal Credit Union and Zelle, claiming the financial institutions did not do enough to protect them from fraudulent activity on Zelle’s digital peer-to-peer payment platform.
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77 thoughts onConsumer Financial Protection Bureau files lawsuit against Zelle, banks over fraud
I reported to forexfraudteam.carrd.co got my stolen money back.
I have been sent for several notices about breach of data
add me to this please i have cap one and wells fargo and have used zelle a bunch thanks.
Yes, please add me as I have now been found to have 13 breaches of my information
Add me please
I had to hire a grey hat hacker callled realtreeofalpha to help tackle identity theft crisis. Bad actors are getting the best of most bank security and customers usually pay for it. Talk to a professional asap if you notice anything suspicious.
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I lost two chase accts due to Zelle someone used my chase acct and I didn’t know my acct was hacked now I can never get an acct with any bank due to being hacked I never did anything wrong I got a statement one month after they closed my accounts due to fraud I had no clue why Didnt they send me a statement the acct were only opened 15days prior to them closing it I’m screwed for something I didn’t know about wow really so I’m in a black list now
A very similar situation happened to me on 02/24/25. I couldn’t log into my BMO checking account online or in the app. So I call the bank and tell them I need help getting back into my account. The rep pulled up my account and told me I couldn’t login because my account was FROZEN due to FRAUD. I was shocked and asked if he could explain what happened. He said it just came through that morning. So he needed to transfer me to the Fraud Dept where someone would be able to help me. I got to the next rep and she tells me again that the fraud claim is new and needs to be investigated. Then they will have more info. All she could tell me was someone had Zelled me $499 on 02/19. Then he called Zelle requesting a refund claiming he had been scammed. I told her I didn’t even know this person and I never saw the Zelle transfer in my account. I told her to tell the investigator to call me so I can provide some info, especially since my online Social Security account was recently hacked. After 2 weeks passed and I had not heard from the investigator. So I called BMO on 03/14/25 to find out if I could talk to him. The rep tells me the information is over and a FINAL DECISION had already been made that I committed FRAUD and I was barrel from ever having another BMO account. I was devastated and angry at the same time. I asked the rep how the investigator could make a Final Decision when he never spoke to me? He didn’t have enough information to make the Final Decision without talking to me. So I told the rep that I wanted to file a complaint against the investigator. He took all my info to do that. I finally asked him when I would get the balance of the funds in my account and he said a certified check was mailed out to me that day so I should get it in 7-10 business days. I’m extremely upset that there’s a record stating I committed fraud but I have an identity theft company who is going to help me get this straightened out and fix the other problems caused by the hackers over the last 9 months.
Please add me