Top Class Actions’s website and social media posts use affiliate links. If you make a purchase using such links, we may receive a commission, but it will not result in any additional charges to you. Please review our Affiliate Link Disclosure for more information.
The popular payback app, Venmo, is reportedly under investigation by the Consumer Finance Protection Bureau over its collection practices, including how it pursues consumers who owe money.
The consumer watchdog agency slapped Venmo’s parent company, PayPal, with a Civil Investigative Demand, according to The Wall Street Journal. The filing is seeking information “related to Venmo’s unauthorized funds transfers and collections processes, and related matters.”
While the CFPB investigation is not a class action lawsuit, Top Class Actions works to keep viewers informed about issues affecting consumers, including potentially questionable debt collection practices.
Venmo Collection Practices Called Into Question
Venmo is an app that allows users to request and exchange money electronically. It has quickly soared in popularity, with active Venmo accounts rising by 32% in 2020, driven by the rise in preference for touchless ways to exchange funds, according to The Verge.
In 2020, consumers used the Venmo app to exchange $47 billion in payments – an increase of 60% from 2019, according to Reuters.
The app appears to instantly transfer money between users; however, it may take up to a day for the “Venmo-ed” funds to leave a consumer’s bank account. During this time, Venmo will cover the amount; however, if the user does not have sufficient funds in their bank account to cover the transfer, Venmo will pursue the debt.
The app has gone after users with debts from $7 to $3,000, telling them that by “not paying, you run the risk of being reported to a collection agency”, according to The Wall Street Journal.
This investigation isn’t the first time Venmo’s collection practices have come under scrutiny. In 2019, the company was accused of pursuing debt collection against those who say they were scam victims. In addition, Venmo has reportedly been criticized for continuing the same collection practices during the coronavirus pandemic.
For its part, PayPal told The Verge that it was working with the CFPB to respond to the agency’s investigation. It reportedly stated that its subsidiary Venmo “remains deeply committed to its compliance obligations and the company works closely with regulators around the world.”
Venmo has also reportedly insisted that its user agreement outlines its collection practices, adding that it stays in line with all state laws when it comes to debt collection.
Have you been subjected to Venmo collection practices? Tell us about your experience in the comment section below.
Read About More Class Action Lawsuits & Class Action Settlements:
Honda, Hyundai, Kia, Subaru vehicle data collection class action lawsuit investigation
May 17, 2024 | Legal News
123 thoughts onVenmo Collection Practices Under Scrutiny by Consumer Watchdog
Add Me !
I used venmo several times. I did have wierd activity on my bank account shortly after using it.
They froz my account for over a week and still can’t get my money out there is over a 1000 dollars in that account had my water and electricity cut off and itsbstill off because they froz my account they told me 2 or 3 day that went to 4 to 5 day that went 4 to 5 days agai.
I owe 700$ plus and over a 1000$ was charged on my account. Then a lady accidentally sent me money meant for someone else and because I was in negative they would mot give her money back. I had to path her 250$. They refunded like 300$ of the 1000$ but would give no reason for not refunding the other. This company should not be in business. I still owe the money that I did not spend. It was my money husband was in chemo and radiation treatments and was over s 1000$ by the time I seen the charges. Still makes my blood boil. And they got away with it. Angels Harris (Coldewey) aenergy3@gmail.com
I had the worst experience with Venmo. They repeatedly charged my account multiple times for the same transaction every single day for almost a month. My bank account became overdrawn. So then I was charged daily for the insufficient funds. I spoke to Venmo numerous times and they said they were going to correct it. But never did!!! My bank stated they only could close the account and reopen a new account for me. Venmo is only ably to submit the charge twice. I had over 30 days consecutively the same charge. Even the recipient got involved and offered to return the $75.00 Venmo refused. Talk about a big headache. I was trying to buy a house at the time too. Venmo is the worst company ever!
I will never use them ever again.
Add me have several unpleasant issues
I was scammed and stopped the payment immediately with my bank and contacted venmo within an hour. They said there was nothing they could do as it was not ment for mercantile use. They picked up the bill and say I now owe them 400 dollars. That was 4 years ago. I get a call every few months and an email every month. No collection agencies so far. I hate this company
Add me John velasquez I almost have the same thing but mine is I had some unauthorized transactions in my account and I filed a dispute on them and they came back and they denied my dispute so I filed an appeal on the dispute and came back tonight just kept going on for a few months and the transaction kept getting denied when I asked for my account to be credited the money and finally towards the end here it is a new year and they have closed my account and the one of the rules and regulation says that if you file a dispute and it’s all pending and everything then you can’t close your account or if you have disputes been filed in they’re still investigating it you can’t close your account so with all this being said how is it that they can close my account and not credit my unauthorized transactions or even the transactions that I did make and the product was not working and they said I added on a guaranteed on my transactions of merchandise for a refund and here again I’ve been denied so now my account is closed I can’t find out anything I can’t find out how they came to their decision or who made the decision to close my account out nobody will give me any information they tell me to email support what I have sent several emails to support and still no response on it please somebody help me
I went to a money pass ATM to withdraw money from my Venmo account. The money was taken out of my account but nothing came out of the ATM. I had a receipt that came out stating I exceeded my daily limit but that was the only time I used the ATM on that day and no other money had been withdrawn at any time for days. I immediately disputed the transaction to Venmo and took a picture and sent it to Venmo of the receipt that clearly stated my request was denied on the bottom and the top of the receipt said withdrawn the amount I tried to withdraw. There was nobody around the atm when this happened. Venmo investigated and denied my dispute essentially taking my money and refusing to give it back. The merchant claims I received the funds but I did not. This is absolutely incredible that they can steal my money and get away with it. There are cameras on the atm. They can clearly see I did not receive the money because when it did not come out, I raised hell in the store and wanted my money back. But Venmo denied my claim and now I want to pursue legal action against this criminal company that think they are above the law and can steal from people so blatantly. And at the time of this situation, the representative of Venmo I chatted with admitted that this was a problem at the time and that they had people working on solving this issue. Now they say they did not take the money and my claim was denied. That money went somewhere and someone knows it. But they refuse to admit they were wrong and now say I have to pay for it. Yeah right. Not happening. I want to take them to court just on principle alone and make them have to take the time and money to go to court so I can prove they are wrong and thieves
I got done really really wrong by Venmo my account was locked and money was never given back to me for no reason whatsoever. The amount was $1,200 n some change
I was a victim of a scam via venmo. I notified venmo right away. They mentioned they would take care of the situation and it was ok to put a stop payment by calling my bank. Days later Venmo notified me by telling me I owed them money and if I didn’t pay they would sent me to collections. I disputed the charges and got denied. I feel like I’m the one being punished for using Venmo. This online paying system is a scam of it’s own.