The US Consumer Financial Protection Bureau (CFPB) is investigating major American banks, for their handling of customer complaints about payment platform Zelle, the Wall Street Journal reported on Wednesday.
The banks under scrutiny include JPMorgan, Bank of America, and Wells Fargo.
Zelle, which allows US consumers to transfer money to one another, has experienced rapid growth since its inception in 2017. However, this growth has been accompanied by a rise in complaints.
Users have claimed they were scammed by entities posing as government agencies or banks.
US banks must reimburse customers for transactions that they have not authorised, such as those made by hackers. However, no laws exist to protect consumers from transfers they themselves have initiated.
Insiders told the Wall Street Journal that the CFPB has now launched a probe. This investigation will focus on the banks’ responses to disputed Zelle payments and whether they proactively blocked accounts found to have been targeted by scammers.
