If you connected your bank account to Venmo, Robinhood or another financial app, you may be entitled to a settlement
App users are often blissfully unaware of just how much technology is involved in making an application work correctly. For every function, there are heaps of coding. Want to know more? This hands-on training can help.
Third-party data storage companies often handle personal information. A separate company could be responsible when an app has payment functions or money transfers. You would be hard-pressed to find an app that does all of these things in-house.
Thousands of businesses look to the fintech company Plaid to handle their financial logistics between apps and banks. But Plaid is now at the center of a class-action lawsuit. Read on to see if you are entitled to compensation.
Here’s the backstory
San Francisco-based Plaid provides financial services to over 5,000 apps, facilitating anything from money transfers and payments to in-app purchases and crypto exchanges. It operates in six countries, and Visa intended to acquire Plaid in 2020 for $5.3 billion.
The Department of Justice blocked that deal over allegations of antitrust breaches and data privacy practices. The latter forms the basis of the ongoing $58 million class-action lawsuit.
App users had to go through Plaid’s software to connect their bank accounts, and the lawsuit claims “certain improper actions in connection with this process.” Clients of Plaid include industry giants like American Express, Robinhood, and the mobile payment app Venmo
According to the litigation documents, Plaid:
- Used systems to collect more financial data from users than needed
- Captured the banking login details of users through its own Plaid Link interface
The suit alleges that Plaid often designed the Plaid Link interface to resemble the user’s bank account login screen. So, instead of logging into the bank, app users unknowingly provided Plaid with sensitive details.
The list of apps that use Plaid’s services is extensive, more than 5,000. It includes Coinbase, Venmo, Robinhood and more. You can search for a specific app on the lawsuit’s informational website to determine if one you’ve used is on the list.
What you can do about it
If you’ve utilized an app that uses Plaid, there is a good chance you qualify for restitution. As with any lawsuit, you must satisfy several criteria:
- You are a U.S. resident.
- At some point, you connected a financial account to an ipmacted app between Jan. 1, 2013 and Nov. 19, 2021.
- You own one or more financial accounts that Plaid accessed using your login credentials.
- You provided financial account login credentials to Plaid through Plaid Link between Jan. 1, 2013 and Nov.19, 2021.
A recent estimate pegged the number of people eligible for a claim at approximately 98 million. So if all 98 million file for compensation, each would get about 60 cents. There are also important dates that you need to keep in mind.
- You must file a request for exclusion from the settlement by March 4, 2022. The date is also the cut-off for objections to the settlement and to file a notice of intent to appear at the fairness hearing.
- The cut-off for claim forms is April 28, 2022.
If you have questions or need more information about the lawsuit, a Frequently Asked Questions page can help.
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Tags: apps, banks, coding, compensation, Department of Justice, downloads, financial, financial services, lawsuit, personal information, privacy, technology, training
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