Google has filed a lawsuit against the Consumer Financial Protection Bureau (CFPB), challenging the agency’s decision to place its payment division under federal supervision. According to the lawsuit, Google argues that the CFPB’s oversight would impose unnecessary and burdensome regulations based on a “small number of unsubstantiated user complaints.” The issue stems from a peer-to-peer payment product that Google no longer offers in the United States.
The lawsuit was filed in a Washington, DC federal court, following a CFPB order announcing its supervisory authority over Google Payment Corp. The agency raised concerns that Google’s handling of its payment services might pose risks to consumers, citing complaints that Google failed to adequately investigate cases where money was transferred incorrectly.
The legal dispute between Google and the Consumer Financial Protection Bureau (CFPB), a government agency responsible for enforcing consumer protection laws, arises as major tech companies like Google, Apple, and Samsung expand into the financial services sector.
In a statement, Google spokesperson José Castañeda argued that the company’s payment products never posed a risk to users. He described the situation as a case of government overreach, specifically concerning Google Pay’s peer-to-peer payment service, which is no longer available in the U.S. He emphasized that Google is challenging the CFPB’s actions in court.
In its lawsuit, Google argued that the Consumer Financial Protection Bureau (CFPB) made a legal mistake by setting an “exceedingly low bar” for determining what constitutes a sufficient risk to consumers. The company contended that, since the product in question no longer exists, it cannot pose any risks.
However, the CFPB maintained that the discontinuation of Google’s payment products does not exempt the company from its supervision.
If the CFPB gains supervisory authority over Google’s payment division, it would have the power to oversee its operations to ensure compliance with consumer financial regulations. Google’s lawsuit claimed that this would subject the company to on-site inspections and demands for confidential documents and information.
In 2022, the CFPB announced plans to examine nonbank financial institutions that may present risks to consumers. CFPB Director Rohit Chopra stated that this authority allows the agency to respond quickly to potential threats and prevent harm before it spreads.
