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'I have no money': Thousands of Americans see their savings vanish in Synapse fintech crisis (www.cnbc.com)

submitted 1 day ago by [email protected] to c/technology

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CNBC spoke to a dozen customers caught in the Synapse fintech predicament, people who are owed sums ranging from $7,000 to well over $200,000.

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[–] [email protected] 62 points 1 day ago (10 children)

I'm not from the US so unfamiliar with any of this, but having followed the link to the Yotta website from the article, it is a... gambling site? What leap is missing that people would entrust their savings to gambling?

[–] Iheardyoubutsowhat 44 points 1 day ago* (last edited 1 day ago) (2 children)

There was no interest on Yotta accounts. Originally, when you signed up, you were given a lottery ticket everyday for every 25$ in the account. There was a lottery everyday where you could win up to 25000. Then they switched to games where you essentially gambled with the tickets that were given based on your amount.

I was once a member but pulled the money when interest rates started to rise. I was lucky.

I'll also note, when signing up, I was given the impression this FDIC insured.

[–] bitjunkie 1 points 12 hours ago

Originally, it was insured. Synapse changed to brokerage soon before they failed.

[–] [email protected] 3 points 18 hours ago (1 children)

Why did you think they were FDIC insured?

[–] Iheardyoubutsowhat 5 points 17 hours ago (1 children)

Because they said they were, or implied it. I would not have opened a savings account had they not been.

In theory, these people's money isn't gone, it's just misplaced into other banks if I understand correctly...and none of these entities want to pay for a full audit because of cost and probably, liability.

The banks that actually hold the money are FDIC insured, but Yotta is not it seems. The way it's worded it makes it look like Yotta is.

[–] [email protected] 2 points 17 hours ago* (last edited 12 hours ago)

Yeah my understanding is they'll get their money back then

Update: oh, well not if the fintech org didn't actually put your money in those banks lol

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