The\u00a0FTC\u00a0has offered support to\u00a0Epic Games\u00a0in that company\u2019s legal battle with Google.
\nThe Federal Trade Commission (FTC) said Tuesday (Aug. 13) that it had\u00a0filed an amicus brief\u00a0on behalf of Epic in the case, outlining how a federal judge should consider potential remedies when determining relief following a ruling that found Google liable for illegal monopolization.
\nEpic in April\u00a0proposed that a judge\u00a0should require Google to allow for more competition in the distribution of apps on its Android mobile platform. This came after a jury determined in 2023 that Google had abused its\u00a0power as a gatekeeper\u00a0for apps for the platform.
\nEpic wants the judge to require the Google Play Store to allow distribution by other, third-party app stores for six years, to block Google\u2019s dealmaking with device makers that prevents the preloading of other app stores and to stop Google from barring apps from informing users of other, out-of-app purchasing options.
\n\u201cIn its amicus brief, the FTC encourages the court to use its broad power to order a remedy that stops the illegal conduct, prevents its recurrence, and restores competition,\u201d the commission said in a\u00a0news release.
\nThe brief also argues for injunctive relief that restores lost competition \u201cin a forward-looking way\u201d and makes sure a monopolist reap benefits obtained through the antitrust violation.
\n\u201cLooking forward in cases like Epic v. Google often requires the consideration of network effects, data feedback loops, and other key features of digital markets,\u201d the FTC said. \u201cThis could help ensure that potential competitors can overcome the advantages established digital platforms often gain, which include network effects and data incumbency.\u201d
\nThe brief comes days after Google achieved a victory in another antitrust case, with a federal judge dismissing a lawsuit that had accused the tech giant of\u00a0unlawfully dominating\u00a0web search on smartphones.
\nU.S. District Judge Rita Lin found the plaintiffs had not provided enough evidence showing harm from Google\u2019s dominance of the market, but said they could file an amended suit by Sept. 9, pointing to a Washington, D.C., court\u2019s ruling in a separate lawsuit earlier this month which found that Google had created an illegal monopoly over search engines. Google has denied the\u00a0allegations in both suits.
\nThe post FTC Offers Support to Epic Games in Battle With Google appeared first on PYMNTS.com.
\n", "content_text": "The\u00a0FTC\u00a0has offered support to\u00a0Epic Games\u00a0in that company\u2019s legal battle with Google.\nThe Federal Trade Commission (FTC) said Tuesday (Aug. 13) that it had\u00a0filed an amicus brief\u00a0on behalf of Epic in the case, outlining how a federal judge should consider potential remedies when determining relief following a ruling that found Google liable for illegal monopolization.\nEpic in April\u00a0proposed that a judge\u00a0should require Google to allow for more competition in the distribution of apps on its Android mobile platform. This came after a jury determined in 2023 that Google had abused its\u00a0power as a gatekeeper\u00a0for apps for the platform.\nEpic wants the judge to require the Google Play Store to allow distribution by other, third-party app stores for six years, to block Google\u2019s dealmaking with device makers that prevents the preloading of other app stores and to stop Google from barring apps from informing users of other, out-of-app purchasing options.\n\u201cIn its amicus brief, the FTC encourages the court to use its broad power to order a remedy that stops the illegal conduct, prevents its recurrence, and restores competition,\u201d the commission said in a\u00a0news release.\nThe brief also argues for injunctive relief that restores lost competition \u201cin a forward-looking way\u201d and makes sure a monopolist reap benefits obtained through the antitrust violation.\n\u201cLooking forward in cases like Epic v. Google often requires the consideration of network effects, data feedback loops, and other key features of digital markets,\u201d the FTC said. \u201cThis could help ensure that potential competitors can overcome the advantages established digital platforms often gain, which include network effects and data incumbency.\u201d\nThe brief comes days after Google achieved a victory in another antitrust case, with a federal judge dismissing a lawsuit that had accused the tech giant of\u00a0unlawfully dominating\u00a0web search on smartphones.\nU.S. District Judge Rita Lin found the plaintiffs had not provided enough evidence showing harm from Google\u2019s dominance of the market, but said they could file an amended suit by Sept. 9, pointing to a Washington, D.C., court\u2019s ruling in a separate lawsuit earlier this month which found that Google had created an illegal monopoly over search engines. Google has denied the\u00a0allegations in both suits.\nThe post FTC Offers Support to Epic Games in Battle With Google appeared first on PYMNTS.com.", "date_published": "2024-08-13T15:52:07-04:00", "date_modified": "2024-08-13T15:52:07-04:00", "authors": [ { "name": "PYMNTS", "url": "https://www.pymnts.com/author/pymnts/", "avatar": "https://secure.gravatar.com/avatar/f05cc0fdcc9e387e4f3570c17158c503?s=512&d=blank&r=g" } ], "author": { "name": "PYMNTS", "url": "https://www.pymnts.com/author/pymnts/", "avatar": "https://secure.gravatar.com/avatar/f05cc0fdcc9e387e4f3570c17158c503?s=512&d=blank&r=g" }, "image": "https://www.pymnts.com/wp-content/uploads/2024/04/Epic-Games-Google.png", "tags": [ "Antitrust", "Epic Games", "Federal Trade Commission", "FTC", "Google", "Lawsuits", "Legal", "News", "PYMNTS News", "What's Hot" ] }, { "id": "https://www.pymnts.com/?p=2049062", "url": "https://www.pymnts.com/legal/2024/ftx-and-alameda-pay-12-7-billion-to-end-cftc-lawsuit/", "title": "FTX and Alameda Pay $12.7 Billion to End CFTC Lawsuit", "content_html": "FTX\u00a0and sister company Alameda Research have agreed to pay their creditors $12.7 billion.
\nThe\u00a0agreement, approved Wednesday (Aug. 7) by U.S. District Judge P. Kevin Castel, is part of a settlement between the fallen cryptocurrency platform and the\u00a0Commodity Futures Trading Commission\u00a0(CFTC).
\nUnder the agreement, FTX and Alameda will pay back $8.7 billion to investors defrauded by Sam Bankman-Fried, the\u00a0now-jailed founder\u00a0of FTX. The companies must also pay a $4 billion \u201cdisgorgement\u201d for \u201cgains received in connection with the violations\u201d mentioned in the CFTC\u2019s complaint against the defendants.
\nThe order also bans FTX and Alameda Research from \u201ccheating or defrauding\u201d commodity customers, engaging in transactions involving \u201cdigital asset commodities,\u201d either by themselves or on behalf of third parties. However, the agreement does not require the companies to pay a civil penalty.
\nFTX had been one of the most prominent crypto exchanges until November of 2022 when a liquidity shortage led to its quick demise.
\nThe CFTC had accused Bankman-Fried of orchestrating a fraud at the company with the help of his executives, who used billions in FTX funds \u2013 including customer funds \u2014 to trade on other crypto exchanges and fund\u00a0\u201chigh-risk\u201d digital asset investments.
\nBankman-Fried was convicted last year of fraud and conspiracy to commit money laundering and\u00a0sentenced in March\u00a0to 25 years in prison. He is\u00a0appealing the verdict.
\nTwo other ex-FTX executives are\u00a0scheduled to be sentenced\u00a0this fall: former director of engineering Nishad Singh in late October and co-founder Gary Wang in November.
\nSingh pleaded guilty last year and agreed to cooperate with prosecutors, admitting that he knew by the middle of 2022 that Bankman-Fried was\u00a0using customer funds\u00a0without their knowledge. He testified during Bankman-Fried\u2019s criminal trial that he was \u201cembarrassed and ashamed\u201d of reckless and excessive outlays made by his boss, even before he learned the money was coming from allegedly stolen customer funds.
\nWang pleaded guilty to fraud in December 2022. Authorities had charged that he created the specific software code that allowed FTX-affiliated company Alameda to divert FTX customer funds. He also testified on behalf of the prosecution, saying that although Bankman-Fried knew of the multi-billion-dollar deficit at Alameda and FTX, he repeatedly told customers and investors that\u00a0\u201cFTX was fine.\u201d
\nThe post FTX and Alameda Pay $12.7 Billion to End CFTC Lawsuit appeared first on PYMNTS.com.
\n", "content_text": "FTX\u00a0and sister company Alameda Research have agreed to pay their creditors $12.7 billion.\nThe\u00a0agreement, approved Wednesday (Aug. 7) by U.S. District Judge P. Kevin Castel, is part of a settlement between the fallen cryptocurrency platform and the\u00a0Commodity Futures Trading Commission\u00a0(CFTC).\nUnder the agreement, FTX and Alameda will pay back $8.7 billion to investors defrauded by Sam Bankman-Fried, the\u00a0now-jailed founder\u00a0of FTX. The companies must also pay a $4 billion \u201cdisgorgement\u201d for \u201cgains received in connection with the violations\u201d mentioned in the CFTC\u2019s complaint against the defendants.\nThe order also bans FTX and Alameda Research from \u201ccheating or defrauding\u201d commodity customers, engaging in transactions involving \u201cdigital asset commodities,\u201d either by themselves or on behalf of third parties. However, the agreement does not require the companies to pay a civil penalty.\nFTX had been one of the most prominent crypto exchanges until November of 2022 when a liquidity shortage led to its quick demise.\nThe CFTC had accused Bankman-Fried of orchestrating a fraud at the company with the help of his executives, who used billions in FTX funds \u2013 including customer funds \u2014 to trade on other crypto exchanges and fund\u00a0\u201chigh-risk\u201d digital asset investments.\nBankman-Fried was convicted last year of fraud and conspiracy to commit money laundering and\u00a0sentenced in March\u00a0to 25 years in prison. He is\u00a0appealing the verdict.\nTwo other ex-FTX executives are\u00a0scheduled to be sentenced\u00a0this fall: former director of engineering Nishad Singh in late October and co-founder Gary Wang in November.\nSingh pleaded guilty last year and agreed to cooperate with prosecutors, admitting that he knew by the middle of 2022 that Bankman-Fried was\u00a0using customer funds\u00a0without their knowledge. He testified during Bankman-Fried\u2019s criminal trial that he was \u201cembarrassed and ashamed\u201d of reckless and excessive outlays made by his boss, even before he learned the money was coming from allegedly stolen customer funds.\nWang pleaded guilty to fraud in December 2022. Authorities had charged that he created the specific software code that allowed FTX-affiliated company Alameda to divert FTX customer funds. He also testified on behalf of the prosecution, saying that although Bankman-Fried knew of the multi-billion-dollar deficit at Alameda and FTX, he repeatedly told customers and investors that\u00a0\u201cFTX was fine.\u201d\nThe post FTX and Alameda Pay $12.7 Billion to End CFTC Lawsuit appeared first on PYMNTS.com.", "date_published": "2024-08-08T09:19:29-04:00", "date_modified": "2024-08-08T09:19:29-04:00", "authors": [ { "name": "PYMNTS", "url": "https://www.pymnts.com/author/pymnts/", "avatar": "https://secure.gravatar.com/avatar/f05cc0fdcc9e387e4f3570c17158c503?s=512&d=blank&r=g" } ], "author": { "name": "PYMNTS", "url": "https://www.pymnts.com/author/pymnts/", "avatar": "https://secure.gravatar.com/avatar/f05cc0fdcc9e387e4f3570c17158c503?s=512&d=blank&r=g" }, "image": "https://www.pymnts.com/wp-content/uploads/2024/04/FTX-lawsuits.jpg", "tags": [ "Alameda Research", "CFTC", "Commodity Futures Trading Commission", "cryptocurrency", "Financial Crime", "fraud", "FTX", "FTX bankruptcy", "Lawsuits", "News", "PYMNTS News", "Sam Bankman-Fried", "What's Hot", "Legal" ] }, { "id": "https://www.pymnts.com/?p=2022674", "url": "https://www.pymnts.com/legal/2024/ftc-announces-proposed-settlements-with-financial-education-services/", "title": "FTC Announces Proposed Settlements With Financial Education Services", "content_html": "The\u00a0Federal Trade Commission (FTC) has announced\u00a0proposed settlements in a case involving the owners and operators of credit repair operation Financial Education Services (FES).
\nThe proposed court orders include permanent bans for those behind an alleged credit repair pyramid scheme and a requirement to turn over more than $12 million in assets, the regulator said in a Monday (Aug. 5)\u00a0press release.
\n\u201cThese companies promised to clean up people\u2019s credit but failed to deliver,\u201d Samuel Levine, director of the FTC\u2019s Bureau of Consumer Protection, said in the release. \u201cMeanwhile, honest businesses make money selling products and services, not by recruiting, and the drive to recruit, especially when coupled with inflated income claims, is the hallmark of an illegal pyramid.\u201d
\nThe FTC filed its suit against FES in May 2022, alleging that the company falsely promised an easy fix to consumers with low credit scores and then recruited those consumers to join a pyramid scheme that sold credit repair services to others, according to the release.
\nWhen that suit was filed, a federal court temporarily\u00a0shut down FES in response to the FTC\u2019s allegations, PYMNTS reported at the time.
\nThe regulator\u2019s complaint charged that FES and its owners, operators and associated companies deceived consumers about the credit repair services, charged them upfront for the service and made inflated claims about the income consumers could make by recruiting others into FES, the report said.
\nIn one of the proposed settlements, defendant Parimal Naik, along with Financial Education Services, United Wealth Services, VR-Tech, Youth Financial Literacy Foundation and LK Commercial Lending will be permanently prohibited from several unlawful activities, will be required to put a compliance monitoring system in place and will be required to turn over $5.5 million in cash, according to the release.
\nIn other proposed settlements, defendant Michael Toloff, along with VR-Tech Mgt and Statewide Commercial Lending; defendant Christopher Toloff, along with CM Rent; and defendant Gerald Thompson will be permanently banned from providing credit repair services or having any involvement in multi-level marketing.
\nThose three defendants will also be required to turn over assets worth \u201cmillions of dollars,\u201d in assets, $1.7 million and $215,000, respectively, per the release.
\n\u201cThe FTC is committed to stopping deceptive credit repair tactics and shutting down illegal pyramid schemes that prey on struggling consumers,\u201d Levine said in the release.
\nThe post FTC Announces Proposed Settlements With Financial Education Services appeared first on PYMNTS.com.
\n", "content_text": "The\u00a0Federal Trade Commission (FTC) has announced\u00a0proposed settlements in a case involving the owners and operators of credit repair operation Financial Education Services (FES).\nThe proposed court orders include permanent bans for those behind an alleged credit repair pyramid scheme and a requirement to turn over more than $12 million in assets, the regulator said in a Monday (Aug. 5)\u00a0press release.\n\u201cThese companies promised to clean up people\u2019s credit but failed to deliver,\u201d Samuel Levine, director of the FTC\u2019s Bureau of Consumer Protection, said in the release. \u201cMeanwhile, honest businesses make money selling products and services, not by recruiting, and the drive to recruit, especially when coupled with inflated income claims, is the hallmark of an illegal pyramid.\u201d\nThe FTC filed its suit against FES in May 2022, alleging that the company falsely promised an easy fix to consumers with low credit scores and then recruited those consumers to join a pyramid scheme that sold credit repair services to others, according to the release.\nWhen that suit was filed, a federal court temporarily\u00a0shut down FES in response to the FTC\u2019s allegations, PYMNTS reported at the time.\nThe regulator\u2019s complaint charged that FES and its owners, operators and associated companies deceived consumers about the credit repair services, charged them upfront for the service and made inflated claims about the income consumers could make by recruiting others into FES, the report said.\nIn one of the proposed settlements, defendant Parimal Naik, along with Financial Education Services, United Wealth Services, VR-Tech, Youth Financial Literacy Foundation and LK Commercial Lending will be permanently prohibited from several unlawful activities, will be required to put a compliance monitoring system in place and will be required to turn over $5.5 million in cash, according to the release.\nIn other proposed settlements, defendant Michael Toloff, along with VR-Tech Mgt and Statewide Commercial Lending; defendant Christopher Toloff, along with CM Rent; and defendant Gerald Thompson will be permanently banned from providing credit repair services or having any involvement in multi-level marketing.\nThose three defendants will also be required to turn over assets worth \u201cmillions of dollars,\u201d in assets, $1.7 million and $215,000, respectively, per the release.\n\u201cThe FTC is committed to stopping deceptive credit repair tactics and shutting down illegal pyramid schemes that prey on struggling consumers,\u201d Levine said in the release.\nThe post FTC Announces Proposed Settlements With Financial Education Services appeared first on PYMNTS.com.", "date_published": "2024-08-05T18:25:52-04:00", "date_modified": "2024-08-05T18:25:52-04:00", "authors": [ { "name": "PYMNTS", "url": "https://www.pymnts.com/author/pymnts/", "avatar": "https://secure.gravatar.com/avatar/f05cc0fdcc9e387e4f3570c17158c503?s=512&d=blank&r=g" } ], "author": { "name": "PYMNTS", "url": "https://www.pymnts.com/author/pymnts/", "avatar": "https://secure.gravatar.com/avatar/f05cc0fdcc9e387e4f3570c17158c503?s=512&d=blank&r=g" }, "image": "https://www.pymnts.com/wp-content/uploads/2024/08/Federal-Trade-Commission-FTC.jpg", "tags": [ "Christopher Toloff", "consumer credit", "credit scores", "Federal Trade Commission", "FES", "Financial Education Services", "FTC", "Gerald Thompson", "Legal", "LK Commercial Lending", "Michael Toloff", "News", "Parimal Naik", "PYMNTS News", "Statewide Commercial Lending", "United Wealth Services", "VR-Tech", "VR-Tech Mgt", "What's Hot", "Youth Financial Literacy Foundation" ] }, { "id": "https://www.pymnts.com/?p=2022407", "url": "https://www.pymnts.com/legal/2024/musk-alleges-shakespearean-betrayal-in-revived-openai-lawsuit/", "title": "Musk Alleges \u2018Shakespearean\u2019 Betrayal in Revived OpenAI Lawsuit", "content_html": "Elon Musk has reportedly resurrected his suit against\u00a0OpenAI, the AI startup he helped found.
\nThe world\u2019s richest man had\u00a0sued the artificial intelligence (AI) company\u00a0in March, only to withdraw the suit in June one day before it was set to go to trial.
\nNow, he has resumed the legal action, once again\u00a0accusing OpenAI\u00a0and co-founders Sam Altman and Greg Brockman of violating the company\u2019s founding principles by prioritizing profits over the larger common good, The New York Times reported Monday (Aug. 5).
\nMusk alleges that Altman and Brockman, with whom he teamed in 2015 to launch OpenAI, abandoned the company\u2019s original mission of humanity-focused AI when they teamed up with benefactor \u2014 and rival \u2014 Microsoft.
\nMusk, the suit says, was \u201cbetrayed by Mr. Altman and his accomplices \u2026 the perfidy and deceit is of Shakespearean proportions.\u201d
\nOpenAI has said it had planned to move to have the suit dismissed, arguing that it remains committed to a mission to \u201censure\u00a0AGI benefits all of humanity,\u201d in reference to artificial general intelligence, a version of AI that can think and reason on pace with human beings.
\nOpenAI said at the time that it realized AGI will require \u201cfar more resources than we\u2019d originally imagined,\u201d and that the company and Musk agreed in 2017 that a for-profit entity would be needed to acquire those resources. The company also says it advances its mission by building beneficial tools that are widely available.
\nMusk has also sought to ban Apple devices at his companies \u2014 which include X, Tesla and SpaceX \u2014 if they integrate OpenAI at the operating system (OS) level. This came\u00a0 after Apple announced it was\u00a0teaming with OpenAI\u00a0and will integrate that company\u2019s ChatGPT 4o artificial intelligence chatbot into iOS, macOS and iPadOS.
\n\u201cIf Apple integrates OpenAI at the OS level, then Apple\u00a0devices will be banned\u00a0at my companies,\u201d Musk said in a post on X. \u201cThat is an unacceptable security violation.\u201d
\n\u201cAnd visitors will have to check their Apple devices at the door, where they will be stored in a Faraday cage,\u201d Musk added in a later post.
\nThe multibillionaire last year founded his own AI company, dubbed xAI, which recently began\u00a0training its AI chatbot Grok on X \u2013 formerly Twitter \u2013 user accounts.
\nFor all PYMNTS AI coverage, subscribe to the daily\u00a0AI\u00a0Newsletter.
\nThe post Musk Alleges \u2018Shakespearean\u2019 Betrayal in Revived OpenAI Lawsuit appeared first on PYMNTS.com.
\n", "content_text": "Elon Musk has reportedly resurrected his suit against\u00a0OpenAI, the AI startup he helped found.\nThe world\u2019s richest man had\u00a0sued the artificial intelligence (AI) company\u00a0in March, only to withdraw the suit in June one day before it was set to go to trial.\nNow, he has resumed the legal action, once again\u00a0accusing OpenAI\u00a0and co-founders Sam Altman and Greg Brockman of violating the company\u2019s founding principles by prioritizing profits over the larger common good, The New York Times reported Monday (Aug. 5).\nMusk alleges that Altman and Brockman, with whom he teamed in 2015 to launch OpenAI, abandoned the company\u2019s original mission of humanity-focused AI when they teamed up with benefactor \u2014 and rival \u2014 Microsoft.\nMusk, the suit says, was \u201cbetrayed by Mr. Altman and his accomplices \u2026 the perfidy and deceit is of Shakespearean proportions.\u201d\nOpenAI has said it had planned to move to have the suit dismissed, arguing that it remains committed to a mission to \u201censure\u00a0AGI benefits all of humanity,\u201d in reference to artificial general intelligence, a version of AI that can think and reason on pace with human beings.\nOpenAI said at the time that it realized AGI will require \u201cfar more resources than we\u2019d originally imagined,\u201d and that the company and Musk agreed in 2017 that a for-profit entity would be needed to acquire those resources. The company also says it advances its mission by building beneficial tools that are widely available.\nMusk has also sought to ban Apple devices at his companies \u2014 which include X, Tesla and SpaceX \u2014 if they integrate OpenAI at the operating system (OS) level. This came\u00a0 after Apple announced it was\u00a0teaming with OpenAI\u00a0and will integrate that company\u2019s ChatGPT 4o artificial intelligence chatbot into iOS, macOS and iPadOS.\n\u201cIf Apple integrates OpenAI at the OS level, then Apple\u00a0devices will be banned\u00a0at my companies,\u201d Musk said in a post on X. \u201cThat is an unacceptable security violation.\u201d\n\u201cAnd visitors will have to check their Apple devices at the door, where they will be stored in a Faraday cage,\u201d Musk added in a later post.\nThe multibillionaire last year founded his own AI company, dubbed xAI, which recently began\u00a0training its AI chatbot Grok on X \u2013 formerly Twitter \u2013 user accounts.\n\nFor all PYMNTS AI coverage, subscribe to the daily\u00a0AI\u00a0Newsletter.\n\nThe post Musk Alleges \u2018Shakespearean\u2019 Betrayal in Revived OpenAI Lawsuit appeared first on PYMNTS.com.", "date_published": "2024-08-05T13:06:11-04:00", "date_modified": "2024-08-05T13:06:11-04:00", "authors": [ { "name": "PYMNTS", "url": "https://www.pymnts.com/author/pymnts/", "avatar": "https://secure.gravatar.com/avatar/f05cc0fdcc9e387e4f3570c17158c503?s=512&d=blank&r=g" } ], "author": { "name": "PYMNTS", "url": "https://www.pymnts.com/author/pymnts/", "avatar": "https://secure.gravatar.com/avatar/f05cc0fdcc9e387e4f3570c17158c503?s=512&d=blank&r=g" }, "image": "https://www.pymnts.com/wp-content/uploads/2024/03/Elon-Musk-OpenAI.jpg", "tags": [ "AI", "artificial intelligence", "Elon Musk", "greg brockman", "Lawsuits", "Microsoft", "News", "OpenAI", "PYMNTS News", "Sam Altman", "What's Hot", "Legal" ] }, { "id": "https://www.pymnts.com/?p=2019773", "url": "https://www.pymnts.com/legal/2024/stubhub-accused-convoluted-junk-fee-scheme-washington-dc-lawsuit/", "title": "StubHub Accused of \u2018Convoluted Junk Fee Scheme\u2019 in DC Lawsuit", "content_html": "A lawsuit accuses StubHub of tricking its customers into paying inflated prices.
\nThe lawsuit, filed Wednesday (July 31) by Washington, D.C., Attorney General Brian Schwalb, said the concert/event ticketing platform engages in the \u201cdeceptive and unfair\u201d practice of hiding mandatory fees from customers, while also not offering information about why those fees are levied or how they\u2019re calculated.
\n\u201cFor years, StubHub has illegally deceived district consumers through its convoluted junk fee scheme,\u201d Schwalb said in a Wednesday news release. \u201cStubHub lures consumers in by advertising a deceptively low price, forces them through a burdensome purchase process, and then finally reveals a total on the checkout page that is vastly higher than the originally advertised ticket price. This is no accident \u2014 StubHub intentionally hides the true price to boost profits at its customers\u2019 expense.\u201d
\nThe company\u2019s use of a countdown timer pressures consumers into making purchases out of fear that they will lose their tickets, the lawsuit said. Drip pricing makes it almost impossible for consumers to comparison shop as they don\u2019t know what the fee will be until they are near the end of checkout.
\n\u201cSince adopting the drip pricing model in 2015, StubHub has sold nearly 5 million tickets to district consumers, extracting an estimated $118 million in hidden fees,\u201d the news release said.
\nReached for comment by PYMNTS, a StubHub spokesperson provided this statement: \u201cWe are disappointed that the D.C. attorney general is targeting StubHub when our user experience is consistent with the law, our competitors\u2019 practices and the broader eCommerce sector. We strongly support federal and state solutions that enhance existing laws to empower consumers, such as requiring all-in pricing uniformly across platforms.\u201d
\nRegardless of the outcome of the suit, research by PYMNTS Intelligence showed the importance of a smooth checkout, with half of all consumers considering the ease of a merchant\u2019s checkout process when deciding where to shop.
\n\u201cBusinesses that can adapt to very convenient ways for customers to pay are going to win in the long run \u2026 so staying on top of offerings for a streamlined payment and checkout approach is a heavy focus,\u201d Justin Downey, vice president of product at Maverick Payments, told PYMNTS earlier this year.
\n\u201cAnything that makes processes quicker and easier with less obstacles for customers, that\u2019s where the excitement is,\u201d he added.
\nThe Washington lawsuit comes weeks after StubHub reportedly halted plans for an initial public offering (IPO), citing an unpredictable market.
\nThe post StubHub Accused of \u2018Convoluted Junk Fee Scheme\u2019 in DC Lawsuit appeared first on PYMNTS.com.
\n", "content_text": "A lawsuit accuses StubHub of tricking its customers into paying inflated prices.\nThe lawsuit, filed Wednesday (July 31) by Washington, D.C., Attorney General Brian Schwalb, said the concert/event ticketing platform engages in the \u201cdeceptive and unfair\u201d practice of hiding mandatory fees from customers, while also not offering information about why those fees are levied or how they\u2019re calculated.\n\u201cFor years, StubHub has illegally deceived district consumers through its convoluted junk fee scheme,\u201d Schwalb said in a Wednesday news release. \u201cStubHub lures consumers in by advertising a deceptively low price, forces them through a burdensome purchase process, and then finally reveals a total on the checkout page that is vastly higher than the originally advertised ticket price. This is no accident \u2014 StubHub intentionally hides the true price to boost profits at its customers\u2019 expense.\u201d\nThe company\u2019s use of a countdown timer pressures consumers into making purchases out of fear that they will lose their tickets, the lawsuit said. Drip pricing makes it almost impossible for consumers to comparison shop as they don\u2019t know what the fee will be until they are near the end of checkout.\n\u201cSince adopting the drip pricing model in 2015, StubHub has sold nearly 5 million tickets to district consumers, extracting an estimated $118 million in hidden fees,\u201d the news release said.\nReached for comment by PYMNTS, a StubHub spokesperson provided this statement: \u201cWe are disappointed that the D.C. attorney general is targeting StubHub when our user experience is consistent with the law, our competitors\u2019 practices and the broader eCommerce sector. We strongly support federal and state solutions that enhance existing laws to empower consumers, such as requiring all-in pricing uniformly across platforms.\u201d\nRegardless of the outcome of the suit, research by PYMNTS Intelligence showed the importance of a smooth checkout, with half of all consumers considering the ease of a merchant\u2019s checkout process when deciding where to shop.\n\u201cBusinesses that can adapt to very convenient ways for customers to pay are going to win in the long run \u2026 so staying on top of offerings for a streamlined payment and checkout approach is a heavy focus,\u201d Justin Downey, vice president of product at Maverick Payments, told PYMNTS earlier this year.\n\u201cAnything that makes processes quicker and easier with less obstacles for customers, that\u2019s where the excitement is,\u201d he added.\nThe Washington lawsuit comes weeks after StubHub reportedly halted plans for an initial public offering (IPO), citing an unpredictable market.\nThe post StubHub Accused of \u2018Convoluted Junk Fee Scheme\u2019 in DC Lawsuit appeared first on PYMNTS.com.", "date_published": "2024-07-31T11:49:32-04:00", "date_modified": "2024-07-31T11:49:32-04:00", "authors": [ { "name": "PYMNTS", "url": "https://www.pymnts.com/author/pymnts/", "avatar": "https://secure.gravatar.com/avatar/f05cc0fdcc9e387e4f3570c17158c503?s=512&d=blank&r=g" } ], "author": { "name": "PYMNTS", "url": "https://www.pymnts.com/author/pymnts/", "avatar": "https://secure.gravatar.com/avatar/f05cc0fdcc9e387e4f3570c17158c503?s=512&d=blank&r=g" }, "image": "https://www.pymnts.com/wp-content/uploads/2024/07/StubHub_62ead6.jpg", "tags": [ "entertainment", "junk fees", "Lawsuits", "Legal", "News", "PYMNTS News", "StubHub", "What's Hot" ] }, { "id": "https://www.pymnts.com/?p=2019198", "url": "https://www.pymnts.com/legal/2024/meta-settles-landmark-1-4-billion-biometrics-suit-with-texas/", "title": "Meta Settles Landmark $1.4 Billion Biometrics Suit With Texas", "content_html": "Meta\u00a0will pay a record $1.4 billion to settle a biometrics-related lawsuit in Texas.
\nIn a Tuesday (July 30) news release, Texas Attorney General Ken Paxton said the settlement was the largest ever from an action brought by a single state, and is the largest privacy settlement obtained by an attorney general.
\nAccording to the release, the settlement will stop Meta\u2019s practice of \u201ccapturing and using the personal biometric data of millions of Texans without the authorization required by law.\u201d
\nPaxton\u00a0sued Meta in 2022, accusing the company of capturing millions of Texans\u2019 biometric data without their consent.
\n\u201cIn 2011, Meta rolled out a new feature, initially called Tag Suggestions, that it claimed would improve the user experience by making it easier for users to \u2018tag\u2019 photographs with the names of people in the photo,\u201d the release said. \u201cMeta automatically turned this feature on for all Texans without explaining how the feature worked.\u201d
\nThe release adds that Meta \u2014 unbeknownst to most people in Texas \u2014 spent more than a decade using facial recognition software on essentially every face contained in the photographs uploaded to Facebook, despite knowing that state law forbids this practice unless a business gets a person\u2019s consent.
\nPYMNTS has contacted Meta for comment but has not received a reply. A\u00a0report\u00a0on the settlement Tuesday by CNBC included this statement from the company:
\n\u201cWe are pleased to resolve this matter, and look forward to exploring future opportunities to deepen our business investments in Texas, including potentially developing data centers.\u201d
\nThe settlement comes at a time of heightened privacy concerns surrounding facial recognition, as PYMNTS wrote in May.
\nAt the time, Microsoft had just updated its code of conduct to\u00a0prevent its artificial intelligence\u00a0(AI) service from being used for facial recognition purposes by or for U.S. law enforcement.
\n\u201cMicrosoft is banning it because, as a whole, there is\u00a0still some hesitancy\u00a0and trepidation regarding the use of facial recognition by police,\u201d\u00a0Bob Eckel, CEO of biometric solutions provider\u00a0Aware, told PYMNTS. \u201cSome argue that facial recognition fosters discrimination by being less accurate for certain races, nationalities and ethnicities. However, this is not true.\u201d
\nUnderlining the advancements in facial recognition accuracy, Eckel added, \u201cToday\u2019s facial recognition tools are tested and validated by trustworthy third parties, and certain states require police agencies using facial recognition to only use software deemed to be at least 98 percent accurate across all demographics.\u201d
\nThe post Meta Settles Landmark $1.4 Billion Biometrics Suit With Texas appeared first on PYMNTS.com.
\n", "content_text": "Meta\u00a0will pay a record $1.4 billion to settle a biometrics-related lawsuit in Texas.\nIn a Tuesday (July 30) news release, Texas Attorney General Ken Paxton said the settlement was the largest ever from an action brought by a single state, and is the largest privacy settlement obtained by an attorney general.\nAccording to the release, the settlement will stop Meta\u2019s practice of \u201ccapturing and using the personal biometric data of millions of Texans without the authorization required by law.\u201d\nPaxton\u00a0sued Meta in 2022, accusing the company of capturing millions of Texans\u2019 biometric data without their consent.\n\u201cIn 2011, Meta rolled out a new feature, initially called Tag Suggestions, that it claimed would improve the user experience by making it easier for users to \u2018tag\u2019 photographs with the names of people in the photo,\u201d the release said. \u201cMeta automatically turned this feature on for all Texans without explaining how the feature worked.\u201d\nThe release adds that Meta \u2014 unbeknownst to most people in Texas \u2014 spent more than a decade using facial recognition software on essentially every face contained in the photographs uploaded to Facebook, despite knowing that state law forbids this practice unless a business gets a person\u2019s consent.\nPYMNTS has contacted Meta for comment but has not received a reply. A\u00a0report\u00a0on the settlement Tuesday by CNBC included this statement from the company:\n\u201cWe are pleased to resolve this matter, and look forward to exploring future opportunities to deepen our business investments in Texas, including potentially developing data centers.\u201d\nThe settlement comes at a time of heightened privacy concerns surrounding facial recognition, as PYMNTS wrote in May.\nAt the time, Microsoft had just updated its code of conduct to\u00a0prevent its artificial intelligence\u00a0(AI) service from being used for facial recognition purposes by or for U.S. law enforcement.\n\u201cMicrosoft is banning it because, as a whole, there is\u00a0still some hesitancy\u00a0and trepidation regarding the use of facial recognition by police,\u201d\u00a0Bob Eckel, CEO of biometric solutions provider\u00a0Aware, told PYMNTS. \u201cSome argue that facial recognition fosters discrimination by being less accurate for certain races, nationalities and ethnicities. However, this is not true.\u201d\nUnderlining the advancements in facial recognition accuracy, Eckel added, \u201cToday\u2019s facial recognition tools are tested and validated by trustworthy third parties, and certain states require police agencies using facial recognition to only use software deemed to be at least 98 percent accurate across all demographics.\u201d\nThe post Meta Settles Landmark $1.4 Billion Biometrics Suit With Texas appeared first on PYMNTS.com.", "date_published": "2024-07-30T13:40:54-04:00", "date_modified": "2024-07-30T13:40:54-04:00", "authors": [ { "name": "PYMNTS", "url": "https://www.pymnts.com/author/pymnts/", "avatar": "https://secure.gravatar.com/avatar/f05cc0fdcc9e387e4f3570c17158c503?s=512&d=blank&r=g" } ], "author": { "name": "PYMNTS", "url": "https://www.pymnts.com/author/pymnts/", "avatar": "https://secure.gravatar.com/avatar/f05cc0fdcc9e387e4f3570c17158c503?s=512&d=blank&r=g" }, "image": "https://www.pymnts.com/wp-content/uploads/2022/11/biometrics.png", "tags": [ "biometrics", "Facebook", "facial recognition", "Lawsuits", "Meta", "News", "privacy", "PYMNTS News", "Texas", "Texas attorney general", "What's Hot", "Legal" ] }, { "id": "https://www.pymnts.com/?p=2016390", "url": "https://www.pymnts.com/legal/2024/telecom-subsidy-ruled-unconstitutional-may-go-to-supreme-court/", "title": "Telecom Subsidy Ruled Unconstitutional, May Go to Supreme Court", "content_html": "A monthly charge on American phone bills that subsidizes telecom services for poor and rural users may be reviewed by the U.S. Supreme Court after a federal appeals court said the charge is unconstitutional.
\nThe 5th U.S. Circuit Court of Appeals in New Orleans announced that ruling Wednesday (July 24), saying the charge is \u201ca multibillion-dollar tax nobody voted for,\u201d Bloomberg reported Wednesday.
\nThe ruling came in one of three cases filed by Consumers\u2019 Research, according to the report.
\nIn earlier decisions, two other courts \u2014 the 6th Circuit in Cincinnati and the 11th Circuit in Atlanta \u2014 upheld the program, the report said.
\nThe U.S. Supreme Court declined to review those decisions but could decide to do so now that the 5th Circuit in New Orleans delivered a different decision, per the report.
\nThe program, the Universal Service Fund, is funded by charges levied by the Federal Communications Commission (FCC) and the Universal Service Administrative Co., a nonprofit organization that administers the fund, according to the report.
\nIt disbursed $8.1 billion in 2023, helping 8 million people afford phone and internet service and helping to build telecommunications infrastructure in remote areas, per the report.
\n\u201cIncredible win for telecom consumers, American citizens, and the Constitution,\u201d Will Hild said in a post on X that was reposted by Consumers\u2019 Research.
\n\u201cThis is a significant victory that could set the stage for an even bigger one to come at SCOTUS,\u201d Casey Mattox said in another post on X that was reposted by the advocacy group.
\nFCC Chairwoman Jessica Rosenwercel said in a statement on the ruling that the FCC will \u201cpursue all available avenues for review.\u201d
\n\u201cThis decision is misguided and wrong,\u201d Rosenwercel said. \u201cIt upends decades of bipartisan support for FCC programs that help communications reach the most rural and least-connected households in our country, as well as hospitals, schools and libraries nationwide. The opinion reflects a lack of understanding of the statutory scheme that helped create the world\u2019s best and most far-reaching communications network.\u201d
\nIt was reported in June that AT&T CEO John Stankey said during a telecom industry forum that Congress should empower the FCC to mandate financial contributions from major technology firms towards the Universal Service Fund.
\nUnder current legislation, the fund is sustained by fees levied on subscribers of cellphone and landline services.
\nThe post Telecom Subsidy Ruled Unconstitutional, May Go to Supreme Court appeared first on PYMNTS.com.
\n", "content_text": "A monthly charge on American phone bills that subsidizes telecom services for poor and rural users may be reviewed by the U.S. Supreme Court after a federal appeals court said the charge is unconstitutional.\nThe 5th U.S. Circuit Court of Appeals in New Orleans announced that ruling Wednesday (July 24), saying the charge is \u201ca multibillion-dollar tax nobody voted for,\u201d Bloomberg reported Wednesday.\nThe ruling came in one of three cases filed by Consumers\u2019 Research, according to the report.\nIn earlier decisions, two other courts \u2014 the 6th Circuit in Cincinnati and the 11th Circuit in Atlanta \u2014 upheld the program, the report said.\nThe U.S. Supreme Court declined to review those decisions but could decide to do so now that the 5th Circuit in New Orleans delivered a different decision, per the report.\nThe program, the Universal Service Fund, is funded by charges levied by the Federal Communications Commission (FCC) and the Universal Service Administrative Co., a nonprofit organization that administers the fund, according to the report.\nIt disbursed $8.1 billion in 2023, helping 8 million people afford phone and internet service and helping to build telecommunications infrastructure in remote areas, per the report.\n\u201cIncredible win for telecom consumers, American citizens, and the Constitution,\u201d Will Hild said in a post on X that was reposted by Consumers\u2019 Research.\n\u201cThis is a significant victory that could set the stage for an even bigger one to come at SCOTUS,\u201d Casey Mattox said in another post on X that was reposted by the advocacy group.\nFCC Chairwoman Jessica Rosenwercel said in a statement on the ruling that the FCC will \u201cpursue all available avenues for review.\u201d\n\u201cThis decision is misguided and wrong,\u201d Rosenwercel said. \u201cIt upends decades of bipartisan support for FCC programs that help communications reach the most rural and least-connected households in our country, as well as hospitals, schools and libraries nationwide. The opinion reflects a lack of understanding of the statutory scheme that helped create the world\u2019s best and most far-reaching communications network.\u201d\nIt was reported in June that AT&T CEO John Stankey said during a telecom industry forum that Congress should empower the FCC to mandate financial contributions from major technology firms towards the Universal Service Fund.\nUnder current legislation, the fund is sustained by fees levied on subscribers of cellphone and landline services.\nThe post Telecom Subsidy Ruled Unconstitutional, May Go to Supreme Court appeared first on PYMNTS.com.", "date_published": "2024-07-24T21:04:11-04:00", "date_modified": "2024-07-24T21:04:11-04:00", "authors": [ { "name": "PYMNTS", "url": "https://www.pymnts.com/author/pymnts/", "avatar": "https://secure.gravatar.com/avatar/f05cc0fdcc9e387e4f3570c17158c503?s=512&d=blank&r=g" } ], "author": { "name": "PYMNTS", "url": "https://www.pymnts.com/author/pymnts/", "avatar": "https://secure.gravatar.com/avatar/f05cc0fdcc9e387e4f3570c17158c503?s=512&d=blank&r=g" }, "image": "https://www.pymnts.com/wp-content/uploads/2024/07/5th-Circuit-Court-of-Appeals.jpg", "tags": [ "5th U.S. Circuit Court of Appeals", "Consumers\u2019 Research", "FCC", "Jessica Rosenwercel", "News", "PYMNTS News", "Universal Service Administrative Co.", "Universal Service Fund", "What's Hot", "Will Hild", "Legal" ] }, { "id": "https://www.pymnts.com/?p=2014777", "url": "https://www.pymnts.com/legal/2024/ftc-federal-court-freezes-assets-of-usa-student-debt-relief/", "title": "FTC: Federal Court Freezes Assets of USA Student Debt Relief", "content_html": "The\u00a0Federal Trade Commission (FTC) said Monday (July 22) that a federal court halted the operations and froze the assets of the operators of\u00a0USA Student Debt Relief (USASDR).
\nThe FTC asked the court to issue the\u00a0order, alleging that the operators pretended to be affiliated with the Department of Education and its loan servicers\u00a0and made false promises to student loan borrowers, the regulator said in a Monday\u00a0press release.
\nThe regulator\u2019s complaint names Start Connecting LLC, Start Connecting SAS, and their owners and operators\u00a0Douglas Goodman, Doris Gallon-Goodman and Juan Rojas, according to the release. The organizations collectively do business as USA Student Debt Relief.
\n\u201cBy pretending to be affiliated with the Department of Education and misrepresenting features of its free income-driven loan repayment programs, these scammers bilked millions from the consumers these programs were designed to help,\u201d\u00a0Samuel Levine, director of the FTC\u2019s Bureau of Consumer Protection, said in the release.
\nUSA Student Debt Relief did not immediately reply to PYMNTS\u2019 request for comment.
\nThe FTC\u2019s\u00a0complaint says that the defendants falsely promised permanent low, fixed monthly payments and generous lump-sum loan forgiveness; charged illegal advanced fees; and pocketed consumers\u2019 monthly payments rather than applying them to their loan balances, according to the release.
\nThe complaint also says that USASDR falsely marketed its services with fake testimonials and reviews on its website, on its social media pages, and on third-party consumer review platforms, the release said.
\nIn addition, the complaint alleges that USASDR telemarketers based in Colombia placed unwanted telemarketing calls to consumers, including those on the Do Not Call Registry, and provided English-language contracts to Spanish-speaking consumers, per the release.
\n\u201cWe are pleased that the court preliminarily shut down this predatory operation and froze its assets, and we will continue our efforts to crack down on junk fees, unwanted calls and exploitation of consumers struggling with student loan debt,\u201d Levine said in the release.
\nIn an earlier case involving student loans, the FTC said in March that it was sending millions in refunds to victims of a\u00a0student fraud scheme.
\nThat case involved a fake loan forgiveness scam\u00a0that used many names, including Mission Hills Federal, Federal Direct Group, National Secure Processing and The Student Loan Group.
\nThe post FTC: Federal Court Freezes Assets of USA Student Debt Relief appeared first on PYMNTS.com.
\n", "content_text": "The\u00a0Federal Trade Commission (FTC) said Monday (July 22) that a federal court halted the operations and froze the assets of the operators of\u00a0USA Student Debt Relief (USASDR).\nThe FTC asked the court to issue the\u00a0order, alleging that the operators pretended to be affiliated with the Department of Education and its loan servicers\u00a0and made false promises to student loan borrowers, the regulator said in a Monday\u00a0press release.\nThe regulator\u2019s complaint names Start Connecting LLC, Start Connecting SAS, and their owners and operators\u00a0Douglas Goodman, Doris Gallon-Goodman and Juan Rojas, according to the release. The organizations collectively do business as USA Student Debt Relief.\n\u201cBy pretending to be affiliated with the Department of Education and misrepresenting features of its free income-driven loan repayment programs, these scammers bilked millions from the consumers these programs were designed to help,\u201d\u00a0Samuel Levine, director of the FTC\u2019s Bureau of Consumer Protection, said in the release.\nUSA Student Debt Relief did not immediately reply to PYMNTS\u2019 request for comment.\nThe FTC\u2019s\u00a0complaint says that the defendants falsely promised permanent low, fixed monthly payments and generous lump-sum loan forgiveness; charged illegal advanced fees; and pocketed consumers\u2019 monthly payments rather than applying them to their loan balances, according to the release.\nThe complaint also says that USASDR falsely marketed its services with fake testimonials and reviews on its website, on its social media pages, and on third-party consumer review platforms, the release said.\nIn addition, the complaint alleges that USASDR telemarketers based in Colombia placed unwanted telemarketing calls to consumers, including those on the Do Not Call Registry, and provided English-language contracts to Spanish-speaking consumers, per the release.\n\u201cWe are pleased that the court preliminarily shut down this predatory operation and froze its assets, and we will continue our efforts to crack down on junk fees, unwanted calls and exploitation of consumers struggling with student loan debt,\u201d Levine said in the release.\nIn an earlier case involving student loans, the FTC said in March that it was sending millions in refunds to victims of a\u00a0student fraud scheme.\nThat case involved a fake loan forgiveness scam\u00a0that used many names, including Mission Hills Federal, Federal Direct Group, National Secure Processing and The Student Loan Group.\n\nThe post FTC: Federal Court Freezes Assets of USA Student Debt Relief appeared first on PYMNTS.com.", "date_published": "2024-07-22T17:50:37-04:00", "date_modified": "2024-07-22T17:50:37-04:00", "authors": [ { "name": "PYMNTS", "url": "https://www.pymnts.com/author/pymnts/", "avatar": "https://secure.gravatar.com/avatar/f05cc0fdcc9e387e4f3570c17158c503?s=512&d=blank&r=g" } ], "author": { "name": "PYMNTS", "url": "https://www.pymnts.com/author/pymnts/", "avatar": "https://secure.gravatar.com/avatar/f05cc0fdcc9e387e4f3570c17158c503?s=512&d=blank&r=g" }, "image": "https://www.pymnts.com/wp-content/uploads/2024/07/FTC-Federal-Trade-Commission.jpg", "tags": [ "Federal Trade Commission", "fraud", "FTC", "Legal", "News", "PYMNTS News", "Samuel Levine", "scams", "student debt", "student loans", "USA Student Debt Relief", "What's Hot" ] }, { "id": "https://www.pymnts.com/?p=2013930", "url": "https://www.pymnts.com/legal/2024/federal-reserve-fines-green-dot-44-million-alleging-unfair-practices/", "title": "Federal Reserve Fines Green Dot $44 Million, Alleging Unfair Practices", "content_html": "The\u00a0Federal Reserve Board said Friday (July 19) that it fined\u00a0Green Dot $44 million for unfair and deceptive practices and a deficient consumer compliance risk management program.
\nThe regulator said in\u00a0a Friday\u00a0press release that while marketing, selling and servicing its prepaid debit card products and its tax return preparation payment services, Green Dot violated consumer law.
\nSpecifically, the Federal Reserve Board said, the company failed to adequately disclose the tax refund processing fee for tax preparation services offered on a third-party\u2019s website; blocked access to the accounts of legitimate customers receiving unemployment benefits; lacked reasonable policies and procedures to help those customers solve those blocks; and failed to maintain effective consumer compliance risk management and anti-money laundering (AML) programs.
\n\u201cThe Board is requiring the firm to take several steps to improve these programs,\u201d the regulator said in the release. \u201cGreen Dot must hire an independent third-party to strengthen its consumer compliance risk management programs and address the root causes of consumer complaints. The firm must also develop an effective anti-money laundering program and hire an independent third-party to conduct a review of certain transaction activities.\u201d
\nIn a Friday\u00a0statement addressing this consent order,\u00a0George Gresham, director, CEO and president of Green Dot, said that the company announced earlier this year that it was expecting a public enforcement action from the Federal Reserve, that it has been working closely with the regulator and that it is pleased that the consent order has been finalized.
\n\u201cAs we shared previously, the order relates to practices in place years ago, and we have taken and will continue taking meaningful steps to correct and remediate those issues, including significant updates to our processes, our product packaging and marketing, our management team and our compliance programs,\u201d Gresham said in the statement.
\nGreen Dot will work closely with the Federal Reserve Board to address and comply with all concerns noted in the consent order, he added.
\n\u201cWe remain optimistic about our financial and regulatory positions as well as our future growth potential and opportunity as we serve and empower customers directly and through our partners,\u201d Gresham said.
\nGresham assumed the roles of CEO and president at Green Dot in October 2022, having previously served as the company\u2019s\u00a0chief financial officer and chief operating officer, as well as serving as a member of the board.
\nThe post Federal Reserve Fines Green Dot $44 Million, Alleging Unfair Practices appeared first on PYMNTS.com.
\n", "content_text": "The\u00a0Federal Reserve Board said Friday (July 19) that it fined\u00a0Green Dot $44 million for unfair and deceptive practices and a deficient consumer compliance risk management program.\nThe regulator said in\u00a0a Friday\u00a0press release that while marketing, selling and servicing its prepaid debit card products and its tax return preparation payment services, Green Dot violated consumer law.\nSpecifically, the Federal Reserve Board said, the company failed to adequately disclose the tax refund processing fee for tax preparation services offered on a third-party\u2019s website; blocked access to the accounts of legitimate customers receiving unemployment benefits; lacked reasonable policies and procedures to help those customers solve those blocks; and failed to maintain effective consumer compliance risk management and anti-money laundering (AML) programs.\n\u201cThe Board is requiring the firm to take several steps to improve these programs,\u201d the regulator said in the release. \u201cGreen Dot must hire an independent third-party to strengthen its consumer compliance risk management programs and address the root causes of consumer complaints. The firm must also develop an effective anti-money laundering program and hire an independent third-party to conduct a review of certain transaction activities.\u201d\nIn a Friday\u00a0statement addressing this consent order,\u00a0George Gresham, director, CEO and president of Green Dot, said that the company announced earlier this year that it was expecting a public enforcement action from the Federal Reserve, that it has been working closely with the regulator and that it is pleased that the consent order has been finalized.\n\u201cAs we shared previously, the order relates to practices in place years ago, and we have taken and will continue taking meaningful steps to correct and remediate those issues, including significant updates to our processes, our product packaging and marketing, our management team and our compliance programs,\u201d Gresham said in the statement.\nGreen Dot will work closely with the Federal Reserve Board to address and comply with all concerns noted in the consent order, he added.\n\u201cWe remain optimistic about our financial and regulatory positions as well as our future growth potential and opportunity as we serve and empower customers directly and through our partners,\u201d Gresham said.\nGresham assumed the roles of CEO and president at Green Dot in October 2022, having previously served as the company\u2019s\u00a0chief financial officer and chief operating officer, as well as serving as a member of the board.\nThe post Federal Reserve Fines Green Dot $44 Million, Alleging Unfair Practices appeared first on PYMNTS.com.", "date_published": "2024-07-19T19:07:29-04:00", "date_modified": "2024-07-19T19:07:29-04:00", "authors": [ { "name": "PYMNTS", "url": "https://www.pymnts.com/author/pymnts/", "avatar": "https://secure.gravatar.com/avatar/f05cc0fdcc9e387e4f3570c17158c503?s=512&d=blank&r=g" } ], "author": { "name": "PYMNTS", "url": "https://www.pymnts.com/author/pymnts/", "avatar": "https://secure.gravatar.com/avatar/f05cc0fdcc9e387e4f3570c17158c503?s=512&d=blank&r=g" }, "image": "https://www.pymnts.com/wp-content/uploads/2021/11/Green-Dot.jpg", "tags": [ "AML", "Anti-Money Laundering", "compliance", "federal reserve", "Federal Reserve Board", "fees", "fines", "Green Dot", "Legal", "money laundering", "News", "PYMNTS News", "What's Hot" ] }, { "id": "https://www.pymnts.com/?p=2011922", "url": "https://www.pymnts.com/legal/2024/will-supreme-court-rulings-keep-federal-regulators-in-court/", "title": "Will Supreme Court Rulings Keep Federal Regulators in Court?", "content_html": "When the U.S. Supreme Court overturned its own 40-year-old ruling in the LoperBright Enterprises v. Raimondo case on June 28 \u2014 in what has come to being popularly tagged SCOTUS v. Chevron \u2014 the reaction was split.
\nOn one hand, some politicians and legal experts were outraged that an activist court attacked what it saw as the federal government\u2019s right to regulate. On the other hand, free market advocates saw justification that it hoped would balance what it saw as an overly aggressive federal regulation stance.
\nIn the interim, cooler legal minds have prevailed. Also in the interim, the potential implications of \u201cChevron\u201d \u2014 as well as another lesser-known case decided in the waning days of the court\u2019s term \u2014 are being weighed. Both could have an impact on the banking and payments sector.
\nContrary to early published reports, the decision does not spell the beginning of the end of federal regulation over financial services and payments. It does not put the Consumer Financial Protection Bureau (CFPB) on notice. But it does open legitimate challenges to that authority, especially in cases where current statutes are still open to judicial interpretation.
\n\u201cI think anytime that longstanding laws are overturned, you\u2019re going to see a step back and try to figure out what it means,\u201d Steven Brotman, associate at the legal firm Locke Lord, told PYMNTS recently. \u201cBut I think it is important to know what this decision doesn\u2019t do, and first and foremost, is that it doesn\u2019t overrule any existing decisions. So, if there\u2019s already been litigation and decisions on a statute that\u2019s still binding, maybe someone challenges that very same statute or does something to bring it back into the fold. But as things stand now, it doesn\u2019t change anything that\u2019s already happened.\u201d
\nIn keeping with Brotman\u2019s commentary, Loper, as the case is now known in legal parlance, does not put the CFPB, Federal Deposit Insurance Corporation, Federal Deposit Insurance Corporation, or any other federal agency that regulates banking and payments at an existential risk.
\nBut to understand why they\u2019re not at risk, the word \u201cambiguity\u201d needs to be placed in the context of this decision. As interpreted by several analysts and legal firms, the decision, led by Chief Justice John Roberts, shifts the power to interpret ambiguous laws from federal agencies to the courts, marking a major change in how regulations are interpreted and applied.
\nThe concept of \u201cambiguity\u201d was central to the Court\u2019s reasoning. Under the now-defunct \u201cChevron doctrine,\u201d if a law was deemed ambiguous, courts were required to defer to a government agency\u2019s reasonable interpretation.
\nHowever, Roberts argued that determining whether a statute is truly ambiguous has proven problematic, making the Chevron doctrine unworkable. The majority of Justices asserted that even when faced with ambiguity in technical or scientific matters, courts are capable of making informed decisions, aided by expert briefings and arguments.
\nDissenting opinions took issue with that interpretation. Critics, including dissenting Justice Elena Kagan, warned of a \u201cmassive shock to the legal system.\u201d Kagan argued that the Chevron doctrine has been deeply integrated into modern governance and that its removal could lead to increased judicial activism and policy uncertainty.
\nNo high-profile cases capitalizing on the new \u201cambiguity\u201d ruling have been brought so far, and Brotman said his firm had yet to see one.
\nJudging from writing and opinions that have come out recently, if a federal regulation is unclear or leaves room for interpretation, it can be challenged in court and heard by a judge. If a federal regulation is judged to be \u201cunambiguous,\u201d the court would seem to be required to apply it. By that standard, the CFPB\u2019s existence would seem to be unambiguous as determined by an earlier Supreme Court decision. But if an individual regulation from the CFPB is judged to be ambiguous, current writing and opinions indicate it could be challenged.
\n\u201cI think one of my takeaways would be that existing regulations that have been around for a long time will stand,\u201d Brotman said. \u201cThere\u2019s no reason to panic and think that those are going to change overnight. I think the types of topics going forward that are in the state of play could be junk fees or artificial intelligence or cryptocurrency areas that haven\u2019t really been litigated much over the years. Those are the areas where I think you\u2019ll see the initial litigation.\u201d
\nLoper was not the only decision in the Court\u2019s waning days that could have implications for financial services.
\nIn another late June decision called \u201cCorner Post v. Board of Governors of the Federal Reserve System,\u201d the Court made an important decision about when people or businesses can sue government agencies for harmful decisions. A law called the Administrative Procedure Act (APA) gives people 6 years to file such lawsuits. The Court decided that this 6-year countdown starts when the person or business actually experiences harm from the agency\u2019s decision, not when the agency first made the decision.
\nThis case is particularly important for the payments industry because it involves a challenge to a regulation called Regulation II, which sets the maximum fees that can be charged for debit card usage.
\nThe Court sent the case back to a lower court, allowing the plaintiff (Corner Post) to continue arguing against the regulation. Corner Post believes that the fee limit set by Regulation II is higher than what the law actually allows.
\nIn simpler terms, this decision might give businesses in the payments industry more time to challenge regulations they believe are unfair, even if those regulations were put in place years ago.
\n\u201cTaken together,\u00a0Loper Bright\u00a0and\u00a0Corner Post\u00a0afford greater opportunity to bring challenges to final agency action, including action by the CFPB, the Federal Reserve, and FinCEN,\u201d stated legal firm K&L Gates, which specializes in FinTech law, in a blog post.
\n\u201cWhile the Court in Loper Bright noted that its ruling does \u2018not call into question prior cases that relied on the Chevron framework,\u2019 that statement does not necessarily preclude timely challenges to final agency action that previously passed muster under Chevron, including challenges that are deemed timely under Corner Post. For instance, under the clarification of the APA limitations period in Corner Post, a court might determine that the Regulation II fee limitations are impermissible even though the final agency action setting the fee limitations occurred in 2011,\u201d the post said.
\nThe post Will Supreme Court Rulings Keep Federal Regulators in Court? appeared first on PYMNTS.com.
\n", "content_text": "When the U.S. Supreme Court overturned its own 40-year-old ruling in the LoperBright Enterprises v. Raimondo case on June 28 \u2014 in what has come to being popularly tagged SCOTUS v. Chevron \u2014 the reaction was split.\nOn one hand, some politicians and legal experts were outraged that an activist court attacked what it saw as the federal government\u2019s right to regulate. On the other hand, free market advocates saw justification that it hoped would balance what it saw as an overly aggressive federal regulation stance.\nIn the interim, cooler legal minds have prevailed. Also in the interim, the potential implications of \u201cChevron\u201d \u2014 as well as another lesser-known case decided in the waning days of the court\u2019s term \u2014 are being weighed. Both could have an impact on the banking and payments sector.\nContrary to early published reports, the decision does not spell the beginning of the end of federal regulation over financial services and payments. It does not put the Consumer Financial Protection Bureau (CFPB) on notice. But it does open legitimate challenges to that authority, especially in cases where current statutes are still open to judicial interpretation.\n\u201cI think anytime that longstanding laws are overturned, you\u2019re going to see a step back and try to figure out what it means,\u201d Steven Brotman, associate at the legal firm Locke Lord, told PYMNTS recently. \u201cBut I think it is important to know what this decision doesn\u2019t do, and first and foremost, is that it doesn\u2019t overrule any existing decisions. So, if there\u2019s already been litigation and decisions on a statute that\u2019s still binding, maybe someone challenges that very same statute or does something to bring it back into the fold. But as things stand now, it doesn\u2019t change anything that\u2019s already happened.\u201d\nIn keeping with Brotman\u2019s commentary, Loper, as the case is now known in legal parlance, does not put the CFPB, Federal Deposit Insurance Corporation, Federal Deposit Insurance Corporation, or any other federal agency that regulates banking and payments at an existential risk.\nBut to understand why they\u2019re not at risk, the word \u201cambiguity\u201d needs to be placed in the context of this decision. As interpreted by several analysts and legal firms, the decision, led by Chief Justice John Roberts, shifts the power to interpret ambiguous laws from federal agencies to the courts, marking a major change in how regulations are interpreted and applied.\nThe concept of \u201cambiguity\u201d was central to the Court\u2019s reasoning. Under the now-defunct \u201cChevron doctrine,\u201d if a law was deemed ambiguous, courts were required to defer to a government agency\u2019s reasonable interpretation.\nHowever, Roberts argued that determining whether a statute is truly ambiguous has proven problematic, making the Chevron doctrine unworkable. The majority of Justices asserted that even when faced with ambiguity in technical or scientific matters, courts are capable of making informed decisions, aided by expert briefings and arguments.\nDissenting opinions took issue with that interpretation. Critics, including dissenting Justice Elena Kagan, warned of a \u201cmassive shock to the legal system.\u201d Kagan argued that the Chevron doctrine has been deeply integrated into modern governance and that its removal could lead to increased judicial activism and policy uncertainty.\nNo high-profile cases capitalizing on the new \u201cambiguity\u201d ruling have been brought so far, and Brotman said his firm had yet to see one.\nJudging from writing and opinions that have come out recently, if a federal regulation is unclear or leaves room for interpretation, it can be challenged in court and heard by a judge. If a federal regulation is judged to be \u201cunambiguous,\u201d the court would seem to be required to apply it. By that standard, the CFPB\u2019s existence would seem to be unambiguous as determined by an earlier Supreme Court decision. But if an individual regulation from the CFPB is judged to be ambiguous, current writing and opinions indicate it could be challenged.\n\u201cI think one of my takeaways would be that existing regulations that have been around for a long time will stand,\u201d Brotman said. \u201cThere\u2019s no reason to panic and think that those are going to change overnight. I think the types of topics going forward that are in the state of play could be junk fees or artificial intelligence or cryptocurrency areas that haven\u2019t really been litigated much over the years. Those are the areas where I think you\u2019ll see the initial litigation.\u201d\nLoper was not the only decision in the Court\u2019s waning days that could have implications for financial services.\nIn another late June decision called \u201cCorner Post v. Board of Governors of the Federal Reserve System,\u201d the Court made an important decision about when people or businesses can sue government agencies for harmful decisions. A law called the Administrative Procedure Act (APA) gives people 6 years to file such lawsuits. The Court decided that this 6-year countdown starts when the person or business actually experiences harm from the agency\u2019s decision, not when the agency first made the decision.\nThis case is particularly important for the payments industry because it involves a challenge to a regulation called Regulation II, which sets the maximum fees that can be charged for debit card usage.\nThe Court sent the case back to a lower court, allowing the plaintiff (Corner Post) to continue arguing against the regulation. Corner Post believes that the fee limit set by Regulation II is higher than what the law actually allows.\nIn simpler terms, this decision might give businesses in the payments industry more time to challenge regulations they believe are unfair, even if those regulations were put in place years ago.\n\u201cTaken together,\u00a0Loper Bright\u00a0and\u00a0Corner Post\u00a0afford greater opportunity to bring challenges to final agency action, including action by the CFPB, the Federal Reserve, and FinCEN,\u201d stated legal firm K&L Gates, which specializes in FinTech law, in a blog post.\n\u201cWhile the Court in Loper Bright noted that its ruling does \u2018not call into question prior cases that relied on the Chevron framework,\u2019 that statement does not necessarily preclude timely challenges to final agency action that previously passed muster under Chevron, including challenges that are deemed timely under Corner Post. For instance, under the clarification of the APA limitations period in Corner Post, a court might determine that the Regulation II fee limitations are impermissible even though the final agency action setting the fee limitations occurred in 2011,\u201d the post said.\nThe post Will Supreme Court Rulings Keep Federal Regulators in Court? appeared first on PYMNTS.com.", "date_published": "2024-07-17T04:00:54-04:00", "date_modified": "2024-07-17T10:10:32-04:00", "authors": [ { "name": "PYMNTS", "url": "https://www.pymnts.com/author/pymnts/", "avatar": "https://secure.gravatar.com/avatar/f05cc0fdcc9e387e4f3570c17158c503?s=512&d=blank&r=g" } ], "author": { "name": "PYMNTS", "url": "https://www.pymnts.com/author/pymnts/", "avatar": "https://secure.gravatar.com/avatar/f05cc0fdcc9e387e4f3570c17158c503?s=512&d=blank&r=g" }, "image": "https://www.pymnts.com/wp-content/uploads/2023/09/Supreme-Court.jpg", "tags": [ "bank regulation", "banking", "CFPB", "chevron doctrine", "FDIC", "Featured News", "federal reserve", "News", "PYMNTS News", "regulations", "SEC", "supreme court", "Legal" ] } ] }