PayPal, the leader in online wallet payments, has filed a suit against the US Consumer Financial Protection Bureau (CFPB) over new rules requiring overly strict and constraining reporting for its digital wallets.
Complaints of Unnecessary Reporting
The CFPB has announced a campaign to regulate so-called prepaid cards, to avoid money laundering. In the lawsuit, filed with the United States District Court for the District of Columbia, PayPal claims the rules for prepaid cards have been incorrectly applied to digital wallets, which run on an entirely different principle.
The rules for prepaid cards were updated in April 2019, and ran under the “Prepaid Accounts Under the Electronic Fund Transfer Act (Regulation E). However, PayPal claims the rules should not apply to digital wallets, which transact in an entirely different way and the…