The Consumer Financial Protection Bureau (CFPB) has dismissed its lawsuit against Early Warning Services, which operates the Zelle peer-to-peer payments network, as well as JPMorgan Chase, Bank of America, and Wells Fargo. The CFPB alleged that the firms failed to properly investigate fraud complaints or provide reimbursement to victims.
The dismissal comes after acting Director Russell Vought took over the agency, leading to a decline in cases brought by his predecessor, Rohit Chopra. The move also sparked a legal battle involving the union representing CFPB employees and Elon Musk’s Department of Government Efficiency.
According to the CFPB, customers of the three banks have lost over $870 million since Zelle launched in 2017. However, the dismissal means that victims will not be able to recover funds through clawbacks.
Zelle’s operator and the banks claim the lawsuit was “legally and factually flawed.” The Consumer Bankers Association also defended the banks, stating that they followed the law in offering services through Zelle and are working to counter fraud and scam activity.
Source: https://www.cnbc.com/2025/03/04/cfpb-drops-jpmorgan-bank-of-america-wells-fargo-lawsuit.html