JPMorgan Chase handles at least twenty-two percent of Zelle transactions, according to Crone Consulting LLC, which estimates that the bank processes over $2 billion in roughly 27 million transactions between as many as 54 million unique users per day.
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WASHINGTON — JPMorgan Chase said in a regulatory filing that it has received inquiries from the Consumer Financial Protection Bureau over fraud on the peer-to-peer payments platform Zelle, and that it might fight any ensuing enforcement action in court.
The CFPB is also looking into Zelle, according to the JPMorgan filing, which came in its quarterly report filed with the Securities and Exchange Commission on Friday evening. JPMorgan — alongside a number of other large banks, including Wells Fargo and Bank of America — co-owns Early Warning Services, the parent company of Zelle.
JPMorgan said that it is "responding to inquiries" regarding fund transfers on Zelle.
CFPB staff, the bank said, told JPMorgan that it has the authority to file an enforcement action on the subject.
"The firm is evaluating next steps, including litigation," JPMorgan said in the filing.
In a statement to American Banker, JPMorgan said that, "if necessary, we will not hesitate to seek assistance from courts to uphold the integrity of how these services are provided."
"The CFPB is fully aware we already go above and beyond what the law requires, reimbursing for all unauthorized transactions and even for certain types of scams, so they should expect to be challenged to ensure their actions stay within the bounds of the law," the bank said.
The Long Island bank is the latest financial institution to use new equity to restructure its balance sheet and unload low-yielding assets. Its stock price tumbled after the shares were priced at a considerable discount.
Affirm partners with Sixth Street to sell its buy now/pay later loans to the investment firm; Associated Banc-Corp promotes Steven Zandpour to deputy head of consumer and business banking; Visa Direct speeds up its money transfers; and more in this week's banking news roundup.
Banks will feel the fallout from a court's decision to strike down a Nasdaq rule that would have mandated more disclosure about the racial and gender composition of corporate boards.
The bank said it redeployed proceeds from the sale into high-yielding investments. It also said it would end an employee pension plan to curb expenses.
A close result was complicated by an hour-long adjournment of the New York-based company's annual meeting that angered dissident investors and left them mulling legal action.
