By Sabela Ojea
The Consumer Financial Protection Bureau has dropped a case against three of the biggest U.S. banks, JPMorgan Chase, Bank of America and Wells Fargo, after accusing them of failing to protect users from fraud on peer-to-peer payments platform Zelle.
The financial regulator on Tuesday said that it dismissed its lawsuit against the defendants, which are part of a consortium of big lenders that own Zelle.
The agency's move comes about a month after Russell Vought took over as the new acting head of the CFPB after President Donald Trump fired the Biden-era leader and put in place Treasury Secretary Scott Bessent.
The lawsuit, made public by the CFPB last December, had said that the three banks rushed to roll out Zelle to compete with other payments apps such as PayPal-owned Venmo and Block's Cash App, and that the platform's guardrails against fraud suffered as a result.
Zelle has drawn fire from consumers, regulators and lawmakers over the rise in fraud on its platform.
The Wall Street Journal in August reported that the CFPB was probing the banks over their handling of scams on the platform.
Write to Sabela Ojea at sabela.ojea@wsj.com; @sabelaojeaguix
(END) Dow Jones Newswires
March 04, 2025 13:25 ET (18:25 GMT)
Copyright (c) 2025 Dow Jones & Company, Inc.
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