The US Consumer Financial Protection Bureau (CFPB) has filed a lawsuit against Dave, alleging misleading marketing practices, unauthorized overdraft charges, and poor data privacy standards. The app, which gained popularity for its “no-fee” cash advances, is now under intense scrutiny.
Key Allegations
- Misrepresentation of fees as “optional tips,” leading to unexpected charges.
- Insufficient safeguards for customer data, exposing users to cyber risks.
- Failure to comply with lending regulations, particularly for underprivileged customers.
Industry Implications
This case is part of a broader crackdown on fintech companies, signaling the need for greater regulatory compliance. It also underscores the importance of transparency and ethical practices in building customer trust.
