Dave Stock Slips On Amended DOJ Complaint: Retail Remains Bullish
Synopsis
Dave refuted the DOJ allegations saying it was “government overreach”
Shares of personal finance app maker Dave Inc. ($DAVE) slipped more than 8% on Tuesday as the company revised its fee structure in response to an amended complaint from the Department of Justice over certain fees, but retail sentiment stayed bullish.
Dave said it has simplified its mandatory fee structure, according to a company statement, which added the new fee structure eliminates optional tips and express fees for the company’s ExtraCash product.
The amended complaint from the DOJ had named its co-founder and CEO Jason Wilk as a co-defendant. The complaint didn’t specify the amount of monetary civil penalties or consumer redressal, Reuters reported.
The complaint also reportedly sought a permanent injunction to prohibit the company in making future violations.
Dave strongly refuted the DOJ allegations saying it was a “government overreach” and includes allegations based on “various inaccuracies.”
In an earlier complaint, the Federal Trade Commission accused Dave of misleading marketing messages on certain cash advances and ‘tips’ without consumer consent.
Retail sentiment on Stocktwits, however, remained ‘bullish’ compared to 'bearish' a day earlier with message volumes in the ‘normal’ range.
“The DOJ must prove that there was knowledge of the alleged violation of the law to obtain CMPs. We believe that we have always acted within the law, and we have continued to rely on the fact that other government agencies have previously reviewed the Company’s business model without taking action,” Dave said in a statement.
According to the statement, the company maintains a positive outlook and plans to share an update during its fourth quarter earnings call in early March.
Dave’s budgeting tools help its members manage upcoming bills to avoid overspending and makes cash advances through its flagship ExtraCash product.
Dave’s stock is up 908.35% year-to-date.
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