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FinWise Bank, FinWise Bancorp, and fintech partner American First Finance (AFF) have reached a $2.8 million class action settlement resolving claims from a May 2024 insider data breach. The security incident occurred when a former employee retained system credentials and accessed private records belonging to roughly 689,000 consumers.
FinWise Bank, FinWise Bancorp, and fintech partner American First Finance (AFF) have reached a $2.8 million class action settlement resolving claims from a May 2024 insider data breach. The security incident occurred when a former employee retained system credentials and accessed private records belonging to roughly 689,000 consumers.
The class action lawsuit stems from an insider security breach that occurred on or about May 31, 2024. According to court filings and regulatory disclosures, a former FinWise Bank employee used active credentials after their employment ended to access internal systems containing sensitive client records.
FinWise Bank contracts with American First Finance (AFF) to provide consumer financing products, including installment loans, retail installment contracts, and lease-to-own agreements. In this arrangement, FinWise originates the loan while AFF provides the technology platform and services the accounts.
The compromised databases contained extensive personal information belonging to roughly 689,000 individuals who had applied for or obtained financing through FinWise or AFF. Exposed data included full names, dates of birth, Social Security numbers, and customer account numbers.
Affected consumers filed class action claims alleging that FinWise and AFF failed to enforce basic cybersecurity access controls, revoke former employee login credentials, and adequately protect personal identifying information. The defendants deny all claims of liability, negligence, and legal wrongdoing, maintaining that they acted appropriately to secure systems and resolve the issue. Both sides agreed to the $2.8 million settlement to avoid the expense, delay, and uncertainty of taking the case to trial.
When corporate institutions fail to terminate former employee access privileges, confidential consumer files are left vulnerable to unauthorized viewing, theft, or misuse. Unlike external hacking attempts that trigger automated alarms, insider intrusions can go undetected for extended periods.
Exposing Social Security numbers, dates of birth, and banking details puts everyday consumers at significant risk for identity theft, financial fraud, and unauthorized account takeovers. Bad actors can use stolen identifiers to open fraudulent credit cards, file false tax returns, or apply for loans in a victim’s name.
Victims of data breaches often spend countless hours monitoring credit reports, placing security freezes, and working with law enforcement or financial institutions to clear their names. Taking legal action through class action litigation ensures that financial institutions are held accountable for maintaining strict data security standards while providing affected individuals with identity protection and cash relief.
The settlement establishes a $2.8 million gross fund to cover class member benefits, administrative expenses, court-approved attorneys’ fees of up to $933,333, and service awards for class representatives.
Eligible consumers who submit a valid claim form can receive the following settlement benefits:
Documented Losses Payment: You can claim reimbursement for verified, out-of-pocket financial losses directly tied to the data incident. Eligible expenses include fraudulent bank charges, credit monitoring costs, fees paid for credit reports or freezes, and professional fees incurred addressing identity theft.
Pro Rata Cash Fund Payment: Instead of filing for documented losses, you can elect to receive a basic, equal-share cash payout. The exact amount will depend on the number of valid claims submitted. (If total approved documented loss claims exceed the net fund, the cash fund option will be suspended and documented payments will be reduced pro rata.)
Two Years of Free Credit Monitoring: In addition to either cash option (documented losses or pro rata cash payment), all class members can sign up for two years of complimentary three-bureau credit monitoring services to safeguard their credit profiles against fraudulent activity.
Settlement funds will be disbursed via check or electronic transfer after the court grants final approval.
You may be eligible to receive cash payments and credit monitoring if you meet the following criteria:
You are a living natural person residing in the United States.
Your private information was affected by the FinWise Bank data incident occurring on or about May 31, 2024.
You received an official written or electronic notice of the data incident from FinWise Bank, FinWise Bancorp, or American First Finance.
Even if you do not recall applying for a loan directly with FinWise Bank, you may still be included if you applied for or held an installment loan or lease-to-own agreement through American First Finance.
If you choose to file a claim for documented financial losses, you must provide supporting third-party documentation along with your claim form.
Acceptable proof includes:
Bank, credit card, or financial account statements displaying unreimbursed fraudulent charges or overdraft fees.
Receipts, invoices, or credit card records for credit monitoring services purchased after May 31, 2024.
Official police reports or Federal Trade Commission (FTC) identity theft affidavits documenting unauthorized account activity.
Receipts for notary fees, postage, or legal costs incurred to resolve identity fraud.
If you choose the basic pro rata cash payment or select only the free credit monitoring service, no financial receipts or third-party documentation are required.
If you are an affected class member, make sure to keep track of these key procedural dates:
Exclusion (Opt-Out) Deadline: Class members who wish to exclude themselves from the settlement to preserve their right to sue individually must postmark their request by September 29, 2026.
Objection Deadline: Class members who want to object to the terms of the deal while remaining in the settlement must file their objections by September 29, 2026.
Claim Form Submission Deadline: All claims must be submitted online or postmarked no later than October 29, 2026.
Final Fairness Hearing: Presiding judges will hold a final approval hearing on December 10, 2026, at 10:00 a.m. to decide whether to grant final approval to the settlement agreement.
Payment Distribution: Cash benefits and credit monitoring enrollment codes will be issued after the court issues final approval and all potential legal appeals are fully resolved.
When financial providers and technology partners fail to secure your private identity information, you shouldn’t have to carry the burden or risk on your own. Open class action settlements give everyday consumers a straightforward way to claim financial reimbursement and gain essential identity monitoring tools.
If you received a data breach notice regarding FinWise Bank or American First Finance, gather your records and submit your claim form before the October 29, 2026 deadline.
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