Venmo, the PayPal-owned digital wallet perhaps best known as a way to exchange money with your drinking buddies, is apparently hounding users of delinquent accounts with threats of debt collection, the Wall Street Journal reported Monday.
According to the Journal, which obtained emails sent to Venmo users by the PayPal-owned service, accountholders with outstanding balances ranging from $7 to $3,000 received notices suggesting collections could be in their futures. Language in the emails reportedly specified that users were at “risk of being reported to a collection agency” if they didn’t pay out the owed amounts, but the Journal said Venmo declined to specify whether it was in fact sending delinquent accounts to collectors.
In addition to threats of sending negative accounts to debt hounds, the Journal noted that Venmo recently updated its language in its user agreement to allow it to send owed amounts to collections or effectively seize money in other PayPal accounts. Venmo’s user agreement also specifies that having “any amounts owed to us” is prohibited and that such activity will result in restricted account access across the various platforms, “including limiting your ability to pay or send money with any of the payment methods linked to your Venmo or PayPal account, restricting your ability to send money or make bank transfers.”
With respect to this policy, a Venmo spokesperson told Gizmodo in a statement that the company “has been working for some time to bring policies in line with PayPal’s user agreement.”
“These changes, which have been a PayPal policy for a while, are a result of our efforts to drive policy consistency across platforms,” the spokesperson said. “Venmo reserves the right under our user agreement to pursue collections, which is a path we may pursue if we are otherwise unable to come to a resolution with a user.”
Hiccups in transactions can lead to negative balances, but the Journal noted another way they can appear is if a Venmo user puts a stop on a fraudulent charge linked to their bank account. Depending on the situation—such as if, as the Journal suggested, an individual puts a stop on a transaction that they knowingly made themselves but later realized was a scam—it sounds like Venmo may still come after users for that money.
Venmo states in its user agreement that the service should “only be used to transact with people you know and trust,” such as friends and family. Using Venmo to purchase goods or services from non-authorized vendors is prohibited under the agreement, and the company states that users are liable for any such payments.
The TL;DR here: If you carry a negative balance in your Venmo account, the wallet can come after your PayPal account too. So definitely only share money with people you know.