FTC Seeks to Block FloatMe App From Duping Consumers About Cash Advances

FloatMe and co-founders Joshua Sanchez and Ryan Cleary run a personal finance mobile app that promises consumers who live paycheck to paycheck short-term cash advances if they enroll in a $1.99 monthly membership plan, but they fail to deliver on those promises, alleged the FTC's complaint Tuesday (docket 5:24-cv-00001) in U.S. District Court for Western Texas in San Antonio. Since launching the app in 2019, FloatMe, Sanchez and Cleary have used “misrepresentations” to induce consumers to enroll in a subscription plan, said the complaint. FloatMe advertises that paying consumers can receive cash advances of up to $50 instantly on request, and that consumers can receive that amount immediately after signing up. “But consumers can actually receive only $20, at most,” it said. FloatMe also tells consumers that their cash advance limit will increase over time under an “automated process,” but in fact there’s no such process, “and the vast majority of consumers never receive increases,” it said. FloatMe also repeatedly charges consumers for services without consent, said the complaint. Many consumers have been double-charged for fees, or were charged before the agreed-on repayment date or after canceling their accounts, it said. When consumers try to cancel their memberships, FloatMe “requires them to navigate faulty cancelation mechanisms that are steeped with friction and dark patterns designed to thwart consumers’ attempts to cancel,” it said. The complaint seeks monetary damages and other relief, plus a permanent injunction to prevent future violations of the FTC Act, the Restore Online Shoppers’ Confidence Act and the Equal Credit Opportunity Act.