Title: “Sen. Richard Blumenthal Questions Visa’s Partnership with Elon Musk’s Social Media Platform, X”
This week, Senator Richard Blumenthal, a Democrat from Connecticut, has raised queries regarding Visa’s proposed plan to facilitate payment services on Elon Musk’s social media platform, X. This move comes as X is set to launch a digital wallet feature.
Blumenthal, who holds a significant position on the Senate’s Permanent Subcommittee on Investigations, has expressed concerns about Musk’s past interactions with the Consumer Financial Protection Bureau (CFPB). The CFPB, a consumer watchdog, could play a critical role in regulating the upcoming X Money service. These concerns were outlined in a letter from March 6, obtained by CNBC.
In the letter, Blumenthal highlights the unique status of Elon Musk, X’s Chairman and Chief Technology Officer, and his prior role in weakening the CFPB. He suggested that these actions might allow Visa to leverage the potential conflicts of interest and dubious conduct of its new business associate.
This inquiry by the Senate is an initial indication of the scrutiny Visa might face. The world’s largest credit card network agreed to facilitate peer-to-peer payments on X in late January. Subsequent to the disclosure of this agreement, Musk’s Department of Government Efficiency reportedly got access to CFPB’s data systems. This led to speculations that Musk intended to undermine a future regulator and possibly pilfer trade secrets from rivals to his emerging X Money service.
Blumenthal’s letter, addressed to Visa CEO Ryan McInerney, also raises doubts whether a social media network like X, notorious for “bots, scams, and hate speech,” can combat frauds effectively on its platform. Musk acquired the platform, previously known as Twitter, in 2022.
These matters bring into question X’s capacity to safeguard consumers from fraud and scams as it expands into the financial sector. Blumenthal emphasized Visa’s legal obligation as the world’s leading payment processor to keep its network free from financial crimes, such as scams, fraud, money-laundering, terrorist financing, among others.
Blumenthal has also requested Visa to provide a comprehensive outline of its strategy to enable payments on X, including the service’s business model and Visa’s role in adhering to regulatory requirements related to money laundering and illicit remittances. Furthermore, he urged Visa to release “all records” associated with the deal and communications involving X, Visa, DOGE, and CFPB personnel.
As of now, Visa and X have not responded to the concerns raised in the letter.
