Senator Richard Blumenthal has recently urged Visa to furnish comprehensive documents and strategies regarding its agreement to provide payment services to Elon Musk’s social media platform, X. This request, highlighted in a letter dated March 6, emphasizes Blumenthal’s concerns about Musk’s influence on the Consumer Financial Protection Bureau (CFPB), which is a principal regulator for potential financial services on the platform.
Concerns Over Conflicts of Interest
Blumenthal, who serves as the ranking member of the Senate’s Permanent Subcommittee on Investigations, pointed out that Musk’s recent actions to undermine the CFPB raise substantial concerns. “Visa could potentially exploit the significant conflicts of interest and questionable behavior of its new business associate,” he stated in the correspondence.
This inquiry marks an initial indication of scrutiny towards Visa, which oversees the world’s largest credit card network, following the announcement in late January that it would facilitate peer-to-peer payments on X. Shortly after this deal was revealed, personnel from Musk’s government efficiency department accessed CFPB data systems, leading to allegations that Musk meant to hamper regulatory oversight and possibly misappropriate trade secrets of competitors to benefit his emerging X Money service.
Consumer Protection and Fraud Concerns
The content of the letter also shed light on the apprehensions regarding X’s ability to safeguard its users from fraud as it delves into finance. Blumenthal noted that a social media platform notorious for its prevalence of “bots, scams, and hate speech” faces considerable challenges in preventing fraudulent activities.
“As the foremost payment processor globally, Visa holds a legal obligation to ensure its network is devoid of financial malfeasance such as scams, fraud, and money laundering,” he remarked.
In his inquiry, Blumenthal demanded a thorough outline of Visa’s operational framework for enabling transactions on X, including the service’s business model and Visa’s compliance with necessary regulations for preventing illicit activities.
He also requested “all records” related to the partnership, encompassing communications among personnel from X, Visa, DOGE, and the CFPB.
A representative from Visa acknowledged receipt of the letter and announced that it is currently under review. Meanwhile, a spokesperson for X has not yet responded to requests for comment.
