The Consumer Financial Protection Bureau (CFPB) has filed a lawsuit against Zelle, a peer-to-peer payment platform, citing significant customer losses exceeding $870 million since its inception. This lawsuit, targeting Zelle's operating entity, Early Warning Services, along with major banks like JPMorgan Chase, Bank of America, and Wells Fargo, underscores heightened scrutiny over digital payment systems. Under previous director Rohit Chopra, the CFPB sought to bolster oversight of tech-driven financial products. However, the agency's current leadership, under Acting Director Russell Vought, has restricted examination activities, indicating a broader trend towards diminishing agency power aligned with the Trump administration's agenda.
The CFPB's recent lawsuit against Zelle's operating entity reveals ongoing tensions around consumer protections amid efforts to limit the agency's power under the Trump administration.
Despite the CFPB's initial action to increase oversight on financial products offered by tech companies, the agency now faces significant cutbacks in supervision and examination activities.
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