Latest news with #ElectronicFundTransferAct
Yahoo
25-04-2025
- Business
- Yahoo
Apple, Google lag fintechs' wallets for fraud monitoring: report
This story was originally published on Payments Dive. To receive daily news and insights, subscribe to our free daily Payments Dive newsletter. Digital wallets from payments players like Block and PayPal generally offer better fraud monitoring and liability protection versus similar products from the big technology companies Apple and Google, according to the research organization Consumer Reports. That reflects differing U.S. regulations for wallet providers, according to a review by the consumer research firm of six major consumer wallets. Consumer Reports evaluated a half dozen digital wallets over a 10-month period ending in March for a report released Thursday. The wallets were from Apple, Cash App, Google, PayPal Holdings, Samsung and Venmo. PayPal also owns Venmo. All six allow consumers to make contactless payments and, except for Google, peer-to-peer money transfers. Consumer Reports divided the wallets between traditional tech companies (Apple, Google and Samsung) and the three fintechs that have been more payments focused from their start (Cash App, PayPal and Venmo). The evaluation focused on the wallets' payments and P2P functions. Four of the wallets – from Apple, Cash App, Google and PayPal – were rated broadly equal overall for their wallet and pay functions, slightly ahead of those from Samsung and Venmo. Apple scored highest for the safety of its stored balance and P2P functions. Delicia Hand, senior director covering digital marketplace issues for Consumer Reports, said Wednesday in an interview, that the evaluation reveals a 'gap between the sophisticated technology used to create a daily seamless payments experience and the lack of innovation in the consumer-protection features.' Cash App, PayPal and Venmo are regulated under the Electronic Fund Transfer Act's Regulation E, requiring them to investigate unauthorized transactions and errors, according to the report. The large tech players, meanwhile, do not share that burden, and the fraud-monitoring commitments reflect it, as card issuers bear the obligation to monitor for fraud, Consumer Reports said. 'We understand that Apple is not a bank or a financial services company,' Hand said. 'At the same time, no consumer is distinguishing between Venmo, Cash App, etc., from their use of an Apple wallet. They're not saying, 'OK, now when I use Google or Samsung Pay, I'm going to switch gears to a whole different set of expectations.' The fintechs' disclosure on their legal obligations 'was relatively clear and transparent,' the report found. PayPal and Venmo offer 'slightly more generous liability coverage for unauthorized transactions' than Block's Cash App, the report said. 'All the companies, fintech or traditional tech, have more economic incentive to proactively address and provide stronger consumer protections,' Hand said. 'There's a transfer of trust that's occurring in the digital wallet space that will directly impact transaction volume and therefore revenue.' Digital wallets, commonly linked to a smartphone, enable their users to store credit card and bank account information; some allow the storage of additional data such as government ID data, loyalty program information and electronic tickets for things such as trains and live concerts. Roughly 59% of people use a digital wallet at least once per month, according to a January 2025 Consumer Reports survey of about 2,200 Americans. Apple Wallet was the most often used (39%), followed by PayPal (16%) and Google (14%), according to the survey. Congress has repealed a rule that would have given the Consumer Financial Protection Bureau regulatory oversight of digital wallet providers and other technology and retail companies, Consumer Reports noted. The agency, meanwhile, is fighting in court to reduce its staff by about 90%, to 200 people. The CFPB also oversees Regulation E as part of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, which conferred broad new consumer protections. Less U.S. regulation is likely to 'accelerate digital growth in the short term,' Hand said. 'When you remove some of the regulatory protections you will see more growth and entry of different kinds of payment services,' she said. All of the wallets offer overlapping functions, although Google is the only one of the six not to offer peer-to-peer payments, which the company ended in June 2024 as part of its transition away from Google Pay. Google is also the only company among its wallet peers not to offer a stored balance feature or to require binding arbitration to resolve legal disputes. To opt out of arbitration, and reserve the right to pursue a claim or dispute in court, Cash App, PayPal, and Venmo give users 30 days to mail a written notice opting out of arbitration. Samsung Pay and Samsung Wallet allow users 30 days to opt out via email, while Apple offers no means to avoid arbitration, Consumer Reports found. PayPal and Samsung were the only wallets to require user authentication on their app via a PIN, password or biometric check. Consumer Reports' overview was supported financially by Craig Newmark Philanthropies and Flourish Ventures, a San Francisco-based investment firm. Recommended Reading Digital wallets to overtake debit cards in stores: report Sign in to access your portfolio
Yahoo
11-03-2025
- Business
- Yahoo
Bank fraud: An Upstate couple's warning after losing $15,000
(WSPA) – If someone steals from your bank account, you're protected right? Unfortunately, it's not always that clear cut since the bank won't usually return your funds if someone tricked you into moving the money. But what if your account was accessed and your money was used without you doing a thing One Upstate couple is warning others to check their accounts carefully, after their long fight for their rights when they lost $15,000 to bank fraud. As a land developer in rural Oconee County, Chad Galbreath had always felt secure using his local bank. So when he and his wife Heather discovered dozens of random purchases they never approved in their business account, they immediately called a friend at their Wells Fargo branch in Seneca. 'We were panicking, you know. And so she and I just spent hours on the phone going through charges,' Mrs. Galbreath said. The Galbreaths said nearly $10,000 was missing from their business account, but were told the account had been frozen with nearly $9,000 remaining. The next day came a wake up call. 'By morning we were $700 in the red, so it had continued even overnight after we had called and talked to the morning, so there wasn't really a hold on the account, so we went into the negative,' Mrs. Galbreaths said. 'That's just crazy, like, why they let this many go through,' Mr. Galbreath said. They assumed they had fraud protection for the charges they never approved, until Wells Fargo repeatedly denied their request for reimbursement. The Galbreaths said part of the problem is that Wells Fargo said they failed to report the problem within 60 days, a bank imposed time limit that was threatening to leave them out thousands if it were true. The couple showed 7NEWS the 126 fraudulent charges occurred within 47 days of when they notified the bank. Greenville Attorney Rodney Pillsbury said the law is on their side thanks to the Electronic Fund Transfer Act. 'This is one of the few acts still in play that is consumer friendly. It was passed during the Carter administration and it provides a cap on consumers' liability if some fraudster has truly gotten access to their account and transfers funds, then the financial institution is still responsible for that,' Pillsbury said. But despite the law, the Galbreaths said the denials kept coming. 'So, on the third one, I took each individual charge and started contacting the business and getting disputes letterheads emails saying these were not our charges,' Mrs. Galbreath said. The couple had almost given up hope, until they reached out to 7NEWS Here to Help, and the bank reopened their investigation. 'It was within 24 hours of you, after 8 months of not hearing anything and they never return calls like we always had to call,' Mrs. Galbreath said. In a statement, Wells Fargo told 7NEWS: 'We are pleased we could resolve this matter by working directly with our customer. We sincerely apologize for their experience; this does not reflect the customer service we strive to provide. We are dedicated to ensuring our customer interactions reflect our commitment to excellence, as well as the confidence in knowing that safeguarding their assets is our top priority.' 7NEWS business accounts, like the one that the Galbreath owned, may be less likely to get flagged for transactions. And when the Galbreaths finally got a reimbursement check of more than $15,000, they knew it was time to warn others. 'That's our sole purpose in doing this, besides being eternally grateful to you for your help, but just to make people aware. Definitely check your accounts daily, I would recommend that to anyone, and don't be sure that your money is safe,' Galbreath said. If you ever have trouble with a bank fraud case, you can contact the SC Department of Consumer Affairs to make sure financial institutions are accountable for following the Electronic Fund Transfer Act. Copyright 2025 Nexstar Media, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
The Hill
25-02-2025
- Business
- The Hill
Musk's CFPB conflict
The tech billionaire has long voiced his hopes of turning X into an 'everything app' that would also function as a payment platform, a vision brought one step closer to reality last month after X struck a deal with Visa to launch a digital wallet. While Musk draws nearer to his goal of making X a payment platform, he has also become a leading force behind the Trump administration's cost-cutting efforts, which have effectively gutted the CFPB. As Musk zeroes in on the agency that oversees digital payment platforms, questions are swirling about how he could personally benefit from rolling back the CFPB's oversight capabilities. 'It's important to raise the question of why the new administration is going after a tiny agency that is smaller than some high schools that does very important consumer protection work,' a former CFPB official said. 'The writing has been on the wall for a while in terms of Musk's animosity for the CFPB— someone who has also been very clear about wanting to turn X into the everything app, the payments app [and] the CFPB is the primary payments regulator at the federal level.' Under Biden-era chief Rohit Chopra, the CFPB finalized a rule in November that brought nonbanks offering digital payment apps under its supervision, giving the agency greater authority to oversee companies like Apple, Google, PayPal and Venmo. It also opened up comments on a proposed rule in early January about implementing the Electronic Fund Transfer Act, which aims to protect consumers against errors and fraud from digital payment mechanisms. The rule sought to apply the law to cryptocurrencies and stablecoins. President Trump fired Chopra upon taking office, giving Musk and the Department of Government Efficiency (DOGE) room to begin its overhaul of the CFPB. Musk's DOGE officials directed the agency to freeze all work and fired about a hundred people from the 1,700-person workforce. While Trump also moved to weaken the consumer watchdog during his first term in office, his allies have gone further this time to sideline the agency that has long been a source of frustration among conservatives. A federal judge barred the administration from firing CFPB staff en masse or deleting the agency's data earlier this month amid concerns such steps were imminent. However, government lawyers denied in a court filing Monday that the administration seeks to eliminate the agency.
