CFPB Sues Synapse, Seeking Consumer Funds for Improper Tracking

The Consumer Financial Protection Bureau sued the bankruptcy estate for Synapse Financial Technologies Inc. to help consumers recover funds lost because of the company’s alleged failure to maintain adequate records.

The complaint filed Thursday in the US Bankruptcy Court for the Central District of California follows a notice filed earlier this month by the trustee managing Synapse in Chapter 11 that the company anticipated litigation with the CFPB. The trustee said the company was negotiating a proposed stipulated final judgment with nominal monetary penalties.

In its single-count complaint, the consumer watchdog said Synapse’s failures as an intermediary between certain ...