A federal investigation into banking large JPMorgan Chase is focusing on how the financial institution handles and protects potential victims of fraud, in keeping with a brand new report.
The Client Monetary Safety Bureau (CFPB) is investigating whether or not the financial institution is correctly reimbursing clients and successfully eliminating scammer’s financial institution accounts, reports CNBC, citing sources who requested anonymity whereas speaking about an ongoing investigation.
The company’s issues are centered on how the financial institution manages clients that transfer cash on Zelle, and investigators are reportedly additionally wanting into related issues about Wells Fargo and Financial institution of America.
In a current submitting, Chase confirmed an inquiry is underway and stated it’s “evaluating subsequent steps, together with litigation.”
The financial institution has declined to publicly touch upon the CFPB’s investigation.
The Senate’s Everlasting Subcommittee on Investigations lately determined Chase, Wells Fargo and BofA reimbursed victims who reported scams on Zelle 38% of the time in 2023, a drop from 62% in 2019.
The subcommittee additionally says the three banks have collectively refused to reimburse $880 million in disputed Zelle transactions between 2021 and 2023.
The Digital Fund Switch Act explicitly protects individuals who lose cash to unauthorized transfers, however not provide the identical safety when clients are tricked into into approving illicit transactions.
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