Mobile Bank Beam has reached a settlement with the FTC over allegations that it mislead users about access to their funds & interest rates. The settlement still needs to be approved by a judge, but the settlement includes:
- Users given full and immediate access to their funds, including interest
- Beam is banned from operating a mobile banking app or any other product or service that can be used to deposit, store, or withdraw funds
- Beam is banned from misrepresenting interest rates, restrictions and other aspects of any financial product or service
Ideally there needs to be a new suite of laws introduced for these mobile banks that partner with a traditional bank as there are a number of issues currently. For example many are advertised as FDIC insured, but this is through a partner bank and often funds go to a holding account before hinting that partner bank and the funds are not insured during this time. Some mobile banks even use multiple partner banks. We’ve previously reported on the issue users had regarding withdrawing funds from Beam.
