PayPal’s P2P payment service Venmo is under investigation by the Federal Trade Commission.
PayPal has acknowledged the situation in an SEC filing: “On March 28th, 2016, we received a Civil Investigative Demand (CID) from the Federal Trade Commission as part of its investigation to determine whether we, through our Venmo service, have been or are engaged in deceptive or unfair practices in violation of the Federal Trade Commission Act,” the filing reads.
“The CID requests the production of documents and answers to written questions related to our Venmo service. We are cooperating with the FTC in connection with the CID.”
PayPal warns that depending on where the FTC goes with the investigation, there could be some trouble ahead, ranging from legal fees to potential changes in the way that Venmo functions.
The FTC’s scrutiny is sure to be an unwelcome development for the company. The investigation comes as Venmo continues to surge in popularity; in January, the company announced it crossed the $1 billion in payments in a single month milestone.
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