UK Mobile Banking App Dave Faces A US Lawsuit After Allegedly Misleading Customers
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The US Department of Justice and Federal Trade Commission recently launched legal action against the UK-based mobile banking app known as Dave. The lawsuit claims that the app misled its customers regarding its charges.
Furthermore, the suit alleges that the banking app violated United States law by engaging in deceptive advertising practices regarding the cash advances promoted on the platform. It goes on to say that Dave had hidden fees, it misused the customer tips, and it engaged in inadequate cancellation processes for recurring charges.
Initially, the legal action was filed in November 2024, but it did not seek any penalties at the time. It simply named the Dave CEO, Jason Wilk, as a defendant. However, two months later, the new filing called for monetary penalties, consumer redress, and new measures that would prevent further violations.
A statement by the principal deputy assistant attorney general Brian M. Boynton said that the JD is committed to stopping companies and their executives from preying on financially vulnerable consumers using deceptive advertisements, hidden fees, and subscriptions that are purposefully made to be difficult to cancel.
The Dave Team Responds
Since the new filing, Dave responded by accusing the Department of Justice and the FTC of government overreach. It claimed that the lawsuit was based on various inaccuracies, which indicates that the banking app intends to fight back rather than try to settle.
In a statement issued on December 31, the Dave team said: “We believe that we have always acted within the law, and we have continued to rely on the fact that other government agencies have previously reviewed the Company’s business model without taking action.”
They added that the company takes compliance and consumer transparency very seriously and that they intend to vigorously defend themselves in this matter. Lastly, Dave added that the app has seen the introduction of a new fee structure back on December 4, and is now in the process of transitioning existing users to this new model.
