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Online cash advance provider Cleo AI has reached a $17 million settlement with the Federal Trade Commission (FTC) following allegations that the company misled consumers about the availability and speed of its cash advance services.
The FTC’s complaint, outlined in a statement released on March 27, 2025, accused Cleo AI of deceptive advertising that misrepresented how much money users could receive and how quickly they could access funds.
FTC’s Allegations Against Cleo AI
According to Christopher Mufarrige, Director of the FTC’s Bureau of Consumer Protection, the company’s marketing created false expectations for consumers.
“Cleo misled consumers with promises of fast money, but in reality, users received far less than the advertised ‘hundreds of dollars,’ had to pay extra for same-day transfers, and struggled to cancel their subscriptions,” Mufarrige stated.
The FTC’s investigation found that while Cleo AI’s advertisements promised immediate access to cash advances, many customers received significantly lower amounts than expected. Additionally, despite claims of instant or same-day advances, consumers had to pay additional fees for expedited access, yet still faced delays in receiving funds.
The regulatory body also alleged that Cleo AI continued to charge users monthly fees even after they attempted to cancel their subscriptions. Some customers were reportedly informed that they could not cancel their accounts until all outstanding cash advances were repaid.
Cleo AI’s Response
Despite agreeing to the settlement, Cleo AI denies any wrongdoing and insists its advertising practices are transparent.
The company asserts that its ads clearly outline that cash advance eligibility varies among users and that faster disbursement is an optional paid service. Cleo AI also disputes the claim that customers were unable to cancel their subscriptions before repaying advances.
“Though we strongly deny any wrongdoing and are confident we would have prevailed in court, settling this matter allows us to stay focused on our mission—improving the financial lives of millions of Americans,” said Colin Jones, Cleo’s General Counsel.
Regulatory Oversight and Consumer Protection
The settlement underscores the FTC’s commitment to protecting consumers from misleading financial products and ensuring transparency in the fintech and alternative lending sector.
As consumers increasingly seek alternative credit solutions amid economic challenges, regulatory scrutiny of cash advance services and fintech lending practices is expected to remain a key area of enforcement.
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