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Venmo has been a major player in the peer-to-peer payment scene the past few years. If you’re not familiar with the PayPal-owned app, one popular feature is its public news feed. That’s where people post their payments, often with emoji to describe them. But as it gets more popular, some are wondering if it’s secure or private enough. In fact, PayPal recently settled a complaint with the Federal Trade Commission over Venmo about privacy and security. Alison Griswold has covered Venmo at Slate and now at Quartz. She spoke with Marketplace Tech host Molly Wood about the app. The following is an edited transcript of their conversation. 

Molly Wood: The FTC said that Venmo failed to disclose that funds could be frozen or removed based on a company review of the underlying transaction. On its face, that sort of sounds like a security measure [by Venmo], but can you give me an example of how that actually harmed, or could harm, consumers?

Alison Griswold: The reason this was happening in this particular circumstance is because Venmo had for a long time this ban on using Venmo to essentially sell stuff. And when it came across those transactions, they would often flag them as violating the platform and then it would reverse them. And you had a lot of people who were essentially scammers that knew this was going on and would take advantage of it. Venmo did that because they maintained for a long time that the purpose of Venmo wasn't to buy stuff. It was just casual payments between friends. And obviously this gets very blurry very fast, right? Venmo was also encouraging people to pay rent using Venmo.

Wood: And one of the big things about Venmo that I found is — that the that I found annoying — is that it defaults to "public" for all transactions. Why is having your financial transactions be public at all a selling point?

Griswold: I think I'm old, because I never understood that either, why people would want their transactions to be public. But I do think it's part of this whole social economy, right? We are in an era where people really like to share. And there's sort of a satisfaction that a lot of people get from just living in public.

Wood: Venmo said in a statement after the settlement was announced that most of the things that were addressed in the settlement were things that were happening before it was acquired by Braintree and then PayPal. The complaint cites practices leading up to at least 2015. Is it true that this is stuff that's kind of been cleaned up since PayPal acquired Venmo?

Griswold: Probably a lot of it has been cleaned up, but definitely some of this was still going on very much in 2015. So, in early 2015, I got contacted by this guy who basically said he had all this money drained from his bank account through Venmo. It was never totally clear how the intruder got into his account in the first place, but there were all sorts of gaping security flaws. So that all happened in early 2015 at the point at which you would really think that Venmo should've cleaned up a lot of this.

Wood: And if people see news about the settlement now, should they worry about how secure Venmo is or how "grown-up" it is?

Griswold: You know, it's a good question. I think just as a general rule on the internet it never hurts to be more cautious as opposed to less cautious. But a lot of people have higher risk tolerances. For them, it's better to just have the convenience of being able to send money. And that's the thing with Venmo, right? It's always sort of a struggle between convenience and safety, because I think it's generally true that the more secure something gets, the more of a hassle it is, too, right? That's also interesting because that's sort of why Venmo, for a long time, did not at all advertise that it was part of PayPal. Because PayPal is thought of as sort of this old, stodgy brand even though it's not that old, right? And Venmo had the hip, cool factor. So, if you're a Venmo, you don't want to lose that social capital. You still want to be seen as this millennial-friendly brand.   

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Follow Molly Wood at @mollywood