If it looks like a bank, advertises like a bank and accepts money like a bank — it still might not be a bank. That is the lesson being meted out in painful fashion to tens of thousands of depositors who entrusted their savings to online-only lenders. But to the surprise of many depositors, these companies merely collect money and funnel it through intermediaries to banks. Because Synapse was not a bank, the F.D.I.C. insurance did not automatically apply, and now nearly $100 million of deposits have been frozen or lost.

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Organizations: Federal Deposit Insurance Corporation, Synapse Financial Locations: U.S