Overview

• The Consumer Financial Protection Bureau (CFPB) dismissed its lawsuit against Zelle's operator, Early Warning Services, and three major banks: JPMorgan Chase, Bank of America, and Wells Fargo.
• The lawsuit, filed under the Biden administration, alleged the banks failed to protect consumers from fraud on Zelle, leading to $870 million in reported losses since 2017.
• The case was dismissed with prejudice, preventing the CFPB from refiling the claims or pursuing consumer compensation for fraud-related losses.
• This marks one of several lawsuits dropped under Acting Director Russell Vought, who has significantly scaled back CFPB operations and halted its enforcement activities.
• Critics argue the dismissals weaken consumer protections, while supporters claim the lawsuits were flawed and overreaching.