Donut, Inc. CFPB Complaints

2000 Latest Complaints

Date Received	Timely Response	Product	Issue	State / Zip	Submitted Via
11/29/2022	Yes	Money transfer, virtual currency, or money service Virtual currency	Fraud or scam	CA 95762	Web
First, On XX/XX/2022, Donut app withdrew {$8500.00} of my principal in my account with them. They made multiple promises that the principal was secure. For example, they promised that " XXXX XXXX is highly collateralized, typically over 125 %. This means your principal is always covered. '' They said, " Donut is a high-yield, fixed income product powered by XXXX XXXX. '' They said, " Lending on Donut is highly collateralized, typically 125 % -200 %, meaning your principal is covered. '' They said in their app that " Your principal is always covered by overcollateralization, typically above 125 % of your principal. '' Donut 's withdrawal of my {$8500.00} violated the promises they made that my " principal is always covered ''. Second, they tweeted and notified me though the app on XX/XX/2022 that, " To our users, Donut has zero exposure to XXXX, XXXX or XXXX. Everything at Donut is running smoothly and were baking steady XXXX as usual. Donut went on to say on the same day, XXXX are one of our approved lenders ( we have others ). Loans with XXXX are overcollateralized ( e.g. 125 % ) If margin calls are not met by borrowers, they seize collateral and/or hedge out collateral risks. They hedged out XXXX risk early this week and have no exposure. Based on their statement, I did not withdraw any of my {$5400.00} in funds that were still in Donut. These were lies, and on XX/XX/2022, prevented all users from withdrawing any funds, including mine. They still claim to have over 100 % liquidity on their app, which is not true.
01/16/2023	Yes	Money transfer, virtual currency, or money service Virtual currency	Money was not available when promised	OR 97701	Web
Donut, Inc is a XXXX " XXXX '' account that converts USD to a stablecoin and in turns lends those funds to the open market for a 6 % return on your money. It heavily promotes its safety, level of liquid reserves, over collaterilization and diversification. I currently have $ XXXX in this companies accounts for which they have frozen 95 % of my money and 100 % of ALL USER 's money claiming that 95 % of there assets are held in XXXX XXXX which was affected by the XXXX fall out. DOnut also maintains that they have 100+ % liquid reserves ( XXXX XXXX XXXXXXXX ). The alos promote 125 % over collateralization. They make claims like " Our partners lend your dollars at high interest rates through a global, decentralized pool of borrowers. We use highly collateralized platforms such as XXXX and XXXX to ensure your money is secure. '' They have a lenghty set of terms bu in # XXXX of the XXXX XXXX XXXX it says " If you don't agree to these changes or no longer wish to abide by these Terms of Use, you can let us know and we'll close your account. '' - but they won't give anyone their money back. Additionally, and still now, on the front page of their site they still promote, " Add or withdraw money anytime. No lock-ins or annual commitments. '' It's now been 2 months and everyone 's money is locked up, not earning anything and they continue to claim they have over 100 % liquid reserves. They only agreed to release 5 % of customer 's deposits about a month ago. So 95 % is still locked up.
12/12/2022	Yes	Checking or savings account Other banking product or service	Managing an account Deposits and withdrawals	MD 21209	Web
On or about XX/XX/2022, XXXX paused all user account activity in its deposit and investment platform, which practically resulted in DONUT inappropriately freezing all user funds. Since this time, user have been denied access to their funds with limited information from the company about if, or when, users will have the ability to access all of their funds. Such actions and practices are contrary to DONUTs marketing and promotional materials and Terms of Use, and may be in violation of state and federal laws including consumer protection laws, securities laws, and the Consumer Financial Protection Act and Regulation E, which implements the Electronic Fund Transfer Act. DONUT has advertised its products and services online and through its app including through emails and messages within the app. I have sent several emails to DONUT, but have not received any responses to my specific questions or concerns.
01/21/2023	Yes	Checking or savings account Savings account	Managing an account Deposits and withdrawals	LA 70003	Web
Donut is an application that offered a 5 % return on savings accounts through what they called decentralized and collateralized lending. They materially misrepresented themselves as diversified and safe when in actuality, 95 % of their assets were loaned through XXXX, which just declared bankruptcy. As a result, do not users have been locked out of their funds since XXXX And are being told that it will probably XXXX more months before they have access again. Their XXXX and websites still advertise them as providing a great return, and having easy access to your money, yet theyre holding everyones deposits hostage.
01/21/2023	Yes	Checking or savings account Other banking product or service	Managing an account Funds not handled or disbursed as instructed	FL 32129	Web
Hello, I have transferred over {$13.00} to DONUT APP last year. I opened an account with them as they advertised better saving with options of 5 % interest and 2 % fee. The app had structured the funds to be diversified and invested to XXXX. Currently {$12000.00} of my funds have been frozen since XX/XX/2022. The company despite stating the funds would be diversified, loaned 95 % of its most secure plan ( XXXX plan ) to XXXX XXXX XXXX which is currently filing for bankruptcy. Please assist.
12/02/2022	Yes	Checking or savings account Savings account	Managing an account Deposits and withdrawals	FL 33135	Web
I deposited {$5500.00} int a high interest savings account with donut.app. Few days later I received an email that said that account was in pause no transfer withdrawals or interest were going to be pay. I searched the internet and I found other that had similar issues month earlier and they still no able to get their money. I asked the company to close account and withdraw my deposited money and no one have answered.
01/25/2023	Yes	Money transfer, virtual currency, or money service Virtual currency	Money was not available when promised	MI 480XX	Web
I invested in a XXXX investment company based in XXXX called Donut back in XXXX of last year in the amount of {$180000.00}, they promised a fixed return of XXXX % with no risk involved, in XXXX of 2022, they froze my account, I can't withdraw anything, based on XXXX XXXX company struggle, now XXXX just filed bankruptcy, and I can't get hold of anybody to see how am I getting my money back.
12/01/2022	Yes	Money transfer, virtual currency, or money service Virtual currency	Money was not available when promised	TX XXXXX	Web
I need to withdraw my principal funds- and funds are not available to me as promised. The max I can withdraw is XXXX per day and I should be able to withdraw at least that amount.
08/01/2023	Yes	Checking or savings account Other banking product or service	Managing an account Funds not handled or disbursed as instructed	MA 01040	Web

01/31/2023	Yes	Checking or savings account Savings account	Managing an account Deposits and withdrawals	SC 29710	Web

01/20/2023	Yes	Checking or savings account Other banking product or service	Problem caused by your funds being low Non-sufficient funds and associated fees	CA 90064	Web

12/10/2022	Yes	Checking or savings account Savings account	Managing an account Deposits and withdrawals	TX 78542	Web

11/22/2022	Yes	Checking or savings account Savings account	Managing an account Deposits and withdrawals	WA 98103	Web