by Scott Kelly and Michael E. Lacy
The Consumer Financial Protection Bureau will begin looking into complaints about prepaid cards – including gift cards, benefit cards, and general purpose reloadable cards – the Bureau announced Monday. Consumers can also now submit complaints about additional nonbank products, including debt settlement services, credit repair services, and pawn and title loans.
The CFPB already investigates complaints about traditional credit cards, mortgages, auto loans, student loans, bank accounts, credit reporting, debt collection, and payday loans. Now, the CFPB will expand its reach to prepaid cards, which generally allow a consumer to access money that has been paid and loaded onto the card upfront.
“Some prepaid cards … have fewer consumer protections than debit or credit cards,” the CFPB said, which can leave consumers vulnerable to fraud and bad business practices.
Consumers will be able to submit prepaid card complaints to the Bureau about:
The CFPB will give companies 15 days to respond to complaints, and 60 days to resolve any problems.
“Today we are taking another important step to expand the bureau’s handling of consumer complaints,” CFPB Director Richard Cordray said in a statement. “By accepting consumer complaints about prepaid products and certain other services, we will be giving people a greater voice in these markets and a place to turn to when they encounter problems.”
Read more at Consumer Financial Services Law Monitor by Troutman Sanders LLP.
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