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Thursday, March 14-March 20, 2024
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VOL. 12,
NO. 163
Walmart bought a finance app and reduced fraud protections. Guess what happened next?
Vietnam Veterans Memorial replica stops in Baldwin Park
By Craig Silverman and Peter Elkind, ProPublica
By Staff
This story was originally published by ProPublica. ProPublica is a Pulitzer Prize-winning investigative newsroom. Sign up for The Big Story newsletter to receive stories like this one in your inbox.
O
nly a few hours elapsed between the time that Carl’s pay landed in his checking account and when online thieves pilfered it. “They took all of it but like 67 cents,” he said. Months before, Carl had signed up for One Finance, a banking app. It’s owned and promoted by Walmart, where Carl works in a grocery department. He was enticed by features like cash back on purchases at Walmart and the chance to receive his pay two days early, as well as by low fees and high interest rates. Everything was fine until Carl used his One debit card — for the very first time — to buy a video game at Walmart last fall. The next time he checked the app, he saw a series of unauthorized transactions that had drained his account. To get by, he tapped his savings, which he said was “just enough to cover everything.” Carl asked to be identified by first name only out of concern for his job security. Carl’s experience has been distressingly common. One Finance was plagued by fraud and customer dissatisfaction after a Walmartcontrolled partnership acquired it in 2022. As Walmart began touting One to employees and others, the “neobank” — as such ultraconvenient, lightly regulated apps are called — weakened user security and outsourced customer support. Con artists took
advantage, spurring a litany of customer complaints to regulators and the Better Business Bureau and across social media platforms. One froze some accounts and blocked access to its app and website from several countries, according to current and former customers and employees. Frustrated users tanked One’s rating on Google Play from 4.6 to 2.8 stars. So many complaints inundated a Reddit community for One users that moderators made the page private “due to ONE fraud issue and their lack of customer support.” One’s Better Business Bureau page warns that scammers are using the One name and logo to steal money via “loan and impersonation scams.” One’s problems echo the fraud and compliance issues revealed in a recent ProPublica investigation of Walmart’s financial services business. That article found that the company resisted calls to rein in fraud and skimped on employee training as more than $1 billion in consumer fraud losses were routed through Walmart’s financial systems over the past decade. One had a higher rate of complaints lodged against it at the federal Consumer Financial Protection Bureau in 2023, its first full year under Walmart control, than most other large neobanks for which data is
Walmart credit card appears on a card reader. | Photo by Mike Mozart CC BY 2.0 DEED
publicly available. The CFPB received 89 complaints about One, which has 1.6 million customers, according to a recent internal company presentation. That was six more complaints than Dave, a neobank with 9.9 million customers. One also has more complaints per customer than both Current and MoneyLion, two large neobanks. Chime, the largest neobank in the U.S., has by far the highest rate of complaints. (These comparisons are imperfect because neobanks don’t always use the same definitions of “customer.”) To Carla SanchezAdams, a senior attorney with the National Consumer Law Center, the rate of complaints about One shows that “they don’t have the proper amount of resources dedicated to resolving customer disputes and complaints.” The CFPB received 13 complaints about One in December, almost double the neobank’s monthly average for 2023. Five drivers for Spark, Walmart’s See Walmart Page 15
delivery service, have complained in the past two months that hackers stole their personal information, set up fake One accounts in their names, and then diverted their paychecks into those accounts. One was “telling me that they were going to escalate this issue, and weeks would go by and I’d never hear anything from them,” said one driver who requested anonymity to protect his job. Walmart eventually reimbursed his lost pay, he said. There are signs that the peak of the One-related fraud may have passed. The Reddit page was made public again at the end of January, and the app’s Google Play rating has rebounded to 4.6 stars. In a statement to ProPublica, One acknowledged blocking access in unspecified countries, due to “significant occurrences or patterns of fraud or cybersecurity risk.” But the neobank denied that problems with fraud, customer support or customer accounts were ever unusually frequent or
Child visits The Wall That Heals. | Photo courtesy of City of Baldwin Park
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he Wall That Heals, a three-quarter scale replica of the Vietnam Veterans Memorial along with a mobile Education Center, will make its first stop on its journey across the continental United States in Baldwin Park from Thursday through Sunday. Bringing The Wall That Heals to Baldwin Park, for the first time in city history, has been years in the making. Over 100 communities across the U.S. apply each year in hopes of being selected for one of The Wall’s visits, which offers a chance to honor the more than three million Americans who served in the U.S. Armed Forces in the Vietnam War. It bears the names of the 58,281 men and women who made the ultimate sacrifice in Vietnam. Los Angeles County residents are invited to The Wall’s opening ceremony on Thursday, March 14, at 10 a.m. in the Cesar E. Chavez Amphitheater in Morgan Park (4100 Baldwin Park Blvd.). That evening, and every evening The Wall is in Baldwin Park, Taps will be performed at sunset by the Baldwin Park High School Band. The Wall That Heals will be open 24/7 and free to all visitors before closing Sunday at 2 p.m. and making its way to El Cajon. “Our city is a big believer in hosting events that nurture community. This is one of the most special events we have ever hosted, bringing people together from all over the San Gabriel Valley and beyond,” said Baldwin Park Mayor Emmanuel J. Estrada. “The Wall will give us all a truly unique experience in honoring our local heroes who fought in Vietnam, to whom we are forever indebted.” The Wall That Heals moves from community to community in a 53-foot trailer that transforms into a mobile education center, complete with exhibits that tell the story of the Vietnam War, The Wall and a divisive era in American History. See Vietnam Veterans Page 31