People living in the United States often use mobile money transfer apps to send money to family and loved ones living abroad. One of his apps, Chime Sendwave, sends more than $1 billion annually.
People living in the United States often use mobile money transfer apps to send money to family and loved ones living abroad. One of his apps, Chime Sendwave, sends more than $1 billion annually.
This is a red flag for the Consumer Financial Protection Bureau, and that’s why they intervene. They claim that the mobile apps mislead consumers about the cost and speed of international money transfers by requiring them to waive rights and protections.
“This is precisely the industry where we have money transfer rules in place that provide protections for consumers,” CFPB Assistant Director of Enforcement Michael Favret told WTOP.
According to the CFPB, the Chime Sendwave app promised to transfer funds instantly, or at least within 30 seconds, but in many cases transfers took longer. And in some cases, apps said they didn’t charge transfer fees, but still charged consumers.
“It’s ripe for abuse, but it’s ripe for deception,” he said.
Consumer lawyer Ira Rheingold, executive director of the National Association of Consumer Advocates, said the apps often target immigrants and people who speak English as a second language.
“This is targeting immigrants. So you’re dealing with people who are relatively new to this country, who are probably even less aware of their rights, and who may not be fully fluent in English.” Maybe,” Rheingold said. “What is interesting about this case is the existence of the Electronic Funds Transfer Act. [are] CERTAIN RIGHTS THAT CANNOT BE WAIVERED. They tried to limit their liability. ”
The CFPB also awarded Chime $1.5 million in refunds and a $150 penalty because Sendwave failed to properly investigate consumer disputes and provide legally required disclosures and receipts to consumers. He said he was ordered to pay $10,000 to the CFPB’s Victim Relief Fund.
“We are focused on this market and making sure market players comply with the law,” Favret said. “If consumers encounter problems with international money transfers, we encourage them to file a complaint with the CFPB.”
