FTC investigates Venmo over possible 'deceptive or unfair practices'
29 April 2016 | 7173 views | 0
The Federal Trade Commission is investigating PayPal over possible "deceptive or unfair practices" related to its hugely popular person-to-person payments service, Venmo.
In a regulatory filing, PayPal reveals that it received a 'Civil Investigative Demand' from the FTC on 28 March asking for documents and answers to written questions on the Venmo service.
The filing does not give details on what the investigation relates to but PayPal says that it could face an enforcement action and/or consent orders, resulting in "substantial costs" from legal fees and fines.
In addition, any move by the regulator "could require us to change aspects of the manner in which we operate Venmo," says the filing.
Acquired by PayPal through its 2013 deal to buy Braintree, Venmo has proved a huge hit. This week it emerged that in the first quarter the P2P payments app saw its volumes grow 154% year-on-year to $3.2 billion. However, it is not a money-maker because transfers are free if made from debit cards and bank accounts.