The Consumer Financial Protection Bureau (CFPB) has imposed a $2 million penalty on Wise, a U.K.-based fintech remittance company, for allegedly engaging in misleading fee disclosures and non-compliant refund policies.
Table of Contents
According to the CFPB, Wise failed to accurately disclose fees, exchange rates, and other costs associated with its services in the United States. The agency also accused Wise of not refunding remittance fees on delayed transactions within the legally required timeframe, resulting in significant financial harm to consumers.
As a result, the CFPB has ordered Wise to:
✅ Pay $450,000 in redress to affected customers
✅ Pay a $2.025 million civil money penalty
💰 Deceptive Fees: What Wise Allegedly Did Wrong
The CFPB’s investigation found that Wise misled U.S. consumers in multiple ways, particularly regarding:
🔹 ATM Withdrawal Fees – The company advertised inaccurate charges, leading customers to believe fees were lower than they actually were.
🔹 Exchange Rate Disclosures – Wise allegedly failed to properly inform users about exchange rate margins, making it harder for them to compare costs.
🔹 Delayed Remittance Refunds – Customers whose transfers did not arrive on time were not refunded their fees promptly, in violation of U.S. financial regulations.
CFPB Director Rohit Chopra condemned the company’s actions, stating:
“By deceiving customers, Wise gave itself an unfair advantage over other competitors in the remittances market. New technology can help make money transfers cheaper and more convenient, but companies must be truthful and live up to longstanding law.”
Cash App Settlement 2025: Eligibility, Payout Per Person, and Everything You Need to Know
BCBS Settlement Payout 2025: When and How You’ll Get Your Payment
$16 Million Capital One Settlement: Are You Eligible for a Payment or Credit?
Get Paid! Verizon $100M Administrative Fees Class Action Settlement
$1,797 Direct Payments for Visa and Mastercard Settlement: Here’s What You Need to Know
🏛️ Wise Responds: “We Addressed the Issues”
In response to the CFPB’s ruling, Wise acknowledged that the agency conducted a routine examination of its U.S. operations between June 2020 and May 2021. Wise stated that in February 2022, the CFPB identified compliance concerns that the company had inadvertently overlooked.
The company claims that it:
✔️ Proactively and voluntarily compensated affected customers
✔️ Cooperated fully with the CFPB
✔️ Resolved the majority of compliance issues by November 2022
In a statement, Wise emphasized:
“At Wise, we continuously invest in our compliance program and processes to ensure we maintain a robust framework, including in the US, where we have strengthened our teams and built substantial tooling.”
The final agreement between Wise and the CFPB was reached on January 30, 2025.
📌 A Growing Trend: Fintechs Under Regulatory Scrutiny
Wise is not the only fintech company facing regulatory action. The CFPB and other financial watchdogs have been increasingly cracking down on deceptive practices within the digital payments and remittances industry.
🔹 Block Inc. (Cash App’s parent company) recently settled an $80 million fine for violating anti-money laundering (AML) and Bank Secrecy Act (BSA) regulations.
🔹 Other fintech firms have faced penalties for hidden fees, misleading advertising, and compliance failures.
As fintech companies expand globally, regulatory agencies are closely monitoring their operations to ensure transparency and consumer protection.
🔍 What This Means for Fintech Users
If you use Wise or other fintech remittance services, here’s what you should keep in mind:
✔️ Always check the fine print – Make sure you understand the fees, exchange rates, and refund policies before making a transaction.
✔️ Compare multiple providers – Some companies offer lower fees upfront but charge hidden costs elsewhere.
✔️ Report misleading practices – If you experience unexpected fees or delays, consider filing a complaint with the CFPB or relevant authorities.
With regulators keeping a closer eye on fintech companies, consumers should expect greater transparency and improved protections in the future.
Leave a Reply