FTC Sues Beam Financial For Failing To Deliver Mobile Banking Users’ Funds
The Federal Trade Commission (FTC) has alleged that the mobile banking app Beam Financial has misled customers about quick transfers of funds, a press release says, with some customers receiving funds late or not at all.
According to a complaint filed by the FTC in federal court, Beam Financial and its founder and CEO Yinan Du, who is known as Aaron Du, told users they’d be able to make transfers from their accounts and get the funds within three to five business days.
That didn’t turn out to be true, according to the FTC, with some customers finding themselves waiting weeks or months for the transfers, which ended up causing them serious fiscal distress. Some, the release says, never received their money at all.
“Beam Financial promised convenient 24/7 access to savings, but then people had to wait weeks or months to get their money,” said Andrew Smith, Director of the FTC’s Bureau of Consumer Protection, according to the release.
The late funds proved to be even more of a problem when several customers, reviewing it on the Google and Apple app stores, claimed they were unable to reach Beam for customer support by phone or email. One user, out $2,900, claimed Beam had “stolen my money during a pandemic.”
Also, Beam promised some users high interest rates, promising a 0.2 or 0.1 rate, while many users actually ended up with much lower 0.04 rates, and didn’t earn interest after requesting that Beam return their money, according to the press release.
Various types of fraud have been on the rise since the pandemic started. The FTC has warned recently against the prominence of social media and app-driven fraud, which has tripled in the past year. The total reported losses for those types of fraud was $134 million in 2019, but the first six months of this year alone saw $117 million in such losses. Some of the most popular scams included eCommerce sites not delivering items that had been promised.