The Federal Trade Commission (FTC) has escalated its legal proceedings against Dave Inc., an online cash advance firm, by referring the case to the U.S. Department of Justice (DOJ). The DOJ has filed an amended complaint that includes Dave's CEO, Jason Wilk, as a defendant and seeks civil penalties.
Initially filed in November 2024, the FTC's case accuses Dave Inc. of misleading marketing practices. The company allegedly deceives consumers about the amount of cash advances it offers, charges undisclosed fees, and imposes "tips" without consumer consent.
"Dave has targeted consumers facing financial challenges with false promises of quick cash while pocketing surprise fees, including by paying itself a so-called ‘tip,’” said Samuel Levine, Director of the FTC’s Bureau of Consumer Protection. “Today the DOJ and FTC have shown their commitment to work together to protect consumers from these unlawful practices.”
The amended complaint specifically names Wilk as a co-defendant. It claims that he and the company falsely market their app as providing up to $500 instantly without hidden fees. However, according to the complaint, consumers rarely receive anywhere near $500 and often face an "express fee" for instant cash advances that is not clearly disclosed before granting app access to their bank accounts.
Further allegations state that Dave Inc. and Wilk have charged consumers hundreds of millions in surprise fees described as "tips." Many users are reportedly unaware they are being charged or how to avoid these tips. Although Dave claims these tips contribute to providing meals for needy children, it only donates 10 cents per percentage point of each tip collected.
The charges against Dave Inc. and Wilk include violations of both the FTC Act and the Restore Online Shoppers’ Confidence Act. The lawsuit seeks refunds for affected consumers and civil penalties against the defendants while urging the court to halt these alleged unlawful activities.
The decision to refer this case for civil penalties was made by a 4-1 vote among FTC commissioners, with Commissioner Melissa Holyoak dissenting. The DOJ has filed this amended complaint on behalf of the Commission in the U.S. District Court for the Central District of California.
According to protocol, when there is reason to believe that defendants are violating or about to violate laws in ways contrary to public interest, complaints seeking civil penalties are referred by the Commission to the DOJ for filing.
Staff attorneys Daniel Hanks, Jason Sanders, and Julia Heald from the FTC’s Bureau of Consumer Protection are handling this matter.
The Federal Trade Commission remains committed to promoting competition while protecting and educating consumers about various issues through resources like consumer.ftc.gov or ReportFraud.ftc.gov.
