Legal experts said they believe the CFPB's action against online payment provider Dwolla – its first action related to data security – could lead to considerable ramifications going forward. The CFPB targeted Dwolla March 2 for deceiving consumers about its data security practices and the safety of its online payment system.
The bureau ordered the Des Moines, Iowa-based Dwolla, an agent of the $2.7 billion, Waterloo, Iowa-based Veridian Credit Union and the Houston-based Compass Bank, to pay a $100,000 penalty and fix its security practices.
"The CFPB's action against Dwolla is significant in that it marks the bureau's first foray into an area that up until now was the domain of the Federal Trade Commission and sets up the enforcement stage in this area for the bureau in 2016," Andrew L. Sandler, chairman and executive partner for the Santa Monica, Calif.-based BuckleySandler, said.
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Roy Urrico
Roy W. Urrico specializes in articles about financial technology and services for Credit Union Times, as well as ghostwriting, copywriting, and case studies. Also: writer/editor of a semi-annual newsletter for Association for Financial Technology since 1997 and history projects funded by the U.S Interior Department, National Park Service and Warren County (N.Y.).
