Subscribers of the Plaid financial services company might be due for some money later this year.
This includes people who connected their banks to financial apps like Acorns, American Express, Coinbase, Credit Karma, Robinhood, and Venmo.
Last year, Silicon Valley accused Plaid of collecting excessive data from unsuspecting users. As a result, Plaid will pay $58 million to the affected users who request a share of the settlement.
Plaid Settlement: Collecting Personal Data
For reference, Plaid is a system that acts as a "middleman" to connect banks with other fintech services. It is being used by tens of millions in North America.
It is also responsible for 5,500 plus client apps directly linked to its services.
The recent class-action lawsuit against the company suggested it might have taken advantage of its clients.
Taken from the settlement website, Plaid is charged with the following allegations:
- Obtained more financial data than what was needed by a user's app
- Obtained login credentials (username and password) through its user interface, known as "Plaid Link"
The allegations emphasized that the company used their Plaid Link to imitate a user's bank account login screen.
The login credentials like the username and password are then stored "directly to Plaid."
Plaid denied these allegations and wrongdoings. It argued that their system was transparent about their practices. .
The lead counsel said the lawsuit's claims "go back to the earliest days of the company-as such, the underlying claims and challenged conduct do not reflect today's Plaid," per Fast Company.
However, they also agreed on a $58 million settlement fund to be used as cash payment for members who submit valid claims for compensation.
How to Get Plaid Link Account Compensation
According to The Verge, eligible recipients should have been notified about the class action lawsuit via email, so users are recommended to check their accounts.
Subscribers interested in receiving their compensation should also submit a claim before April 28.
Applicants should complete the processing prompts found on this website.
It is worth noting that there is one available tool for checking on Plaid fund eligibility. The "Search for App/Service" inspects for any Plaid account connections.
The online tool is available on the same website linked for the application process.
To use it, applicants simply have to put their app or service used on the search bar, and results should automatically dropdown.
Plaid Link Error: How Much Will You Get?
Plaid did not elaborate on how much it would pay per person. However, it is possible to get a rough estimate.
The company agreed to pay $58 million, but a portion of this will be used to cover expenses with settlement administration, court-approved attorneys' fees, and more.
Whatever amount is left from the budget will be divided to the millions of users who are subscribed to the service. At best, this might credit a few dollars, but at worse, it might be down to a few cents.
Hopefully, Plaid will give an update on this settlement sometime this year.
Related Article:
Bobby Kotick Net Worth 2022: Did Activision Blizzard CEO Get Richer After Microsoft's Acquisition?
