Wells Fargo Announces US Plans To Review Zelle Complaint Handling
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Wells Fargo and JP Morgan both said the U.S. authorities are looking into how both firms managed complaints about Zelle’s peer-to-peer payment service.
In a filing sent to the Securities and Exchange Commission, Wells Fargo revealed the United States government’s aim to conduct informal and formal investigations. These investigations are focused on knowing how customer complaints related to the transfer of funds through the Zelle Network are handled.
The San Francisco bank did not reveal the names of the US authorities involved in the investigation. The lender also did not provide any more information on how the investigation is been carried out.
JPMorgan Cooperates With The US SEC In Providing Relevant Details On The Issue
JPMorgan gave a quarterly report to the Securities and Exchange Commission on Wednesday. The bank mentioned that it was answering questions from government officials about issues related to Zelle. They’re working with the officials and giving them the necessary information.
Zelle is a digital payments network introduced in 2017. It is part of Early Warning Services, a company based in Scottsdale, Arizona. Early Warning Services is owned by seven large American banks: Wells Fargo, JPMorgan, PNC, Bank of America, Truist, Capital One, and U S Bank.
The payments app was recognized by the public after The New York Times revealed fraud allegations concerning Zelle in a March 2022 pronouncement. The report described how banks failed to pay back funds to customers who were victims of fraud in cases when customers permitted the payments.
Senator Elizabeth Warren from Massachusetts issued a report in October 2022. She called on the Consumer Financial Protection Bureau to strengthen and clarify the rules that dictate when banks need to reimburse customers who have been defrauded.
Three US Senators Send Their Approval For The Suggested Rule
Recently, three Democratic senators from the United States, including Warren, sent a letter to CFPB Director Rohit Chopra. They expressed their approval for a suggested rule that would allow the bureau to oversee digital payment apps such as Zelle.
The letter from senators Warren, Sherrod Brown, and Jack Reed came just 24 hours after representatives Mike Flood, French Hill, and Patrick McHenry wrote to Chopra.
The three representatives asked for an extra 60 days to provide their comments on the suggested rule. Comments on this rule were accepted until January 8th.
The rule being discussed would explain a market where customers normally use digital payment applications for daily transactions. This includes companies that offer services for transferring funds and managing wallets through digital applications. These applications are used by consumers to make payments to others for family, personal, or household expenses.
