The Federal Trade Commission is investigating Venmo in an effort to determine if the P2P service has been involved in “deceptive or unfair practices.” PayPal, Venmo’s parent firm, acknowledged the investigation in an SEC filing yesterday (April 28).
“On March 28, 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.”
The filing from PayPal also notes that, depending on the direction and outcome of the investigation in progress, Venmo could face a variety of possible consequences, including some changes to how the app currently functions.
The investigation comes as a piece of dark news when both Venmo and its parent firm were previously in a celebratory mode. PayPal is coming off a very strong earnings report, and as of January, Venmo was up to $1 billion a month in payments on its platform.
Venmo is not alone in its market space — Square, Google and Facebook all offer competing P2P services — though Venmo is, by far, the segment leader.
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