7 On Your Side first told you about the federal lawsuit in December when we talked exclusively to the company's CEO. He talked to us exclusively again regarding this latest development. The settlement means both Beam and its owner won't ever be able to operate a mobile financial app again.
Beam's website today simply says Beam is "revamping."
RELATED: CEO of SF-based Beam speaks out after FTC files lawsuit
That's very different from December, when Beam offered interest rates exceeding 4 percent.
Customers tell us the high interest rates advertised dried up last fall.
Their efforts to withdraw their money failed.
Malini Mithal of the Federal Trade Commission says in all, Beam took in $2.6 million in deposits.
"We don't want him in a position again, where he can take consumers funds and promise to store them or let the consumers withdraw them when they can't," said Mithal.
The settlement means all that money must be refunded to customers.
Beam CEO Aaron Du says the process of giving refunds began last year. "Back then the vast majority of funds had been returned to customers," he said.
Christopher Milliorn had $15,000 in deposits with Beam. He says one day the app just stopped working and he couldn't get his money out.
"A lot of work that went into saving that much money. And so it makes you worry quite a bit, you know, that that's just gone. That, you know, you're not gonna get it back," he said.
Christopher did eventually get all his money back, before the end of last year.
But his story is not unique.
"I think there are people saying things like, 'I don't have the money to pay my groceries, you know? I'd have the money to pay my bills and now I can't even access my money that I put in the Beam account,'" said Mithal.
Du tells 7 On Your Side he's sorry.
"We are ultimately the party who they trust. So we failed that trust and so absolutely, we apologize for that," he said. "We don't agree with the settlement in the sense that I don't think it's a just settlement. But we have no choice but to agree to that."
Du says Beam will return in some form. But at this time, he has no plans to announce.
Take a look at more stories and videos by Michael Finney and 7 On Your Side.
Have a question for Michael and the 7 On Your Side team? Fill out the form HERE!
7OYS's consumer hotline is a free consumer mediation service for those in the San Francisco Bay Area. We assist individuals with consumer-related issues; we cannot assist on cases between businesses, or cases involving family law, criminal matters, landlord/tenant disputes, labor issues, or medical issues. Please review our FAQ here. As a part of our process in assisting you, it is necessary that we contact the company / agency you are writing about. If you do not wish us to contact them, please let us know right away, as it will affect our ability to work on your case.