Prepaid Cards

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The CFPB has published its Spring 2020 rulemaking agenda as part of the Spring 2020 Unified Agenda of Federal Regulatory and Deregulatory Actions.  It represents the CFPB’s third rulemaking agenda under Director Kraninger’s leadership.  The agenda’s preamble indicates that the information in the agenda is current as of March 5, 2020 and identifies the regulatory…

PayPal has filed a motion for summary judgment in its lawsuit against the CFPB seeking to invalidate the Bureau’s prepaid card rule (“Rule”).  The Rule became effective on April 1, 2019.  The relief sought by PayPal in the lawsuit, which was filed in December 2019 in the D.C. federal district court, includes vacating the…

The Montana Supreme Court, in Bratton v. Sisters of Charity of Leavenworth Health System, Inc., has ruled that a health care provider’s use of prepaid cards to make refunds to patients did not violate Montana law.

In the lawsuit, the plaintiff alleged that SCL Health (SCL), her healthcare provider, violated Montana law by directing…

The CFPB has issued an interpretive rule addressing the application of the Electronic Fund Transfer Act/Regulation E compulsory use prohibition to COVID-19 relief payments made by federal, state, or local government agencies.

The prohibition makes it unlawful for any person to require a consumer to establish an account for the receipt of electronic funds with…

PayPal filed a lawsuit against the CFPB last week in the D.C. federal district court seeking to invalidate the Bureau’s prepaid card rule (“Rule”).  The Rule became effective on April 1 of this year.

PayPal’s primary consumer offering is a “digital wallet.”  A digital wallet is primarily used by a consumer to access his or…

Last week, the defendant filed its answer brief in Bratton v. Sisters of Charity of Leavenworth Health System, Inc., an appeal now pending before the Montana Supreme Court involving a challenge to the defendant’s use of prepaid cards to make refunds to the plaintiff.  In addition, the Montana Bankers Association, the American Bankers Association,…

The CFPB’s final rule on prepaid accounts, which became effective on April 1, 2019, requires issuers of prepaid accounts, with certain exceptions, to submit to the CFPB all account agreements that the issuer offers, amends, or withdraws.  The deadline for the initial submissions was May 1, 2019.  (In February 2019, the CFPB released guidance and…

An appeal now pending before the Montana Supreme Court could have significance for businesses that use prepaid cards to make refunds to customers.

In Bratton v. Sisters of Charity of Leavenworth Health System, Inc., the plaintiff filed a lawsuit against SCL Health (SCL), her healthcare provider, in Montana district court alleging that SCL violated…

On Tuesday, May 14, 2019 in Minneapolis, and on Wednesday, May 15, 2019 in Sioux Falls, Ballard Spahr will host complimentary card issuer workshops.  The workshops are intended to assist companies involved in issuing, marketing, or servicing credit or prepaid cards in meeting their compliance obligations as they face a constantly changing regulatory landscape.

Seasoned…

Last week, the CFPB released its most recent update to the Prepaid Rule Small Entity Compliance Guide.  The new version includes expanded information regarding the process for complying with the Prepaid Rule’s requirement to submit prepaid account agreements and certain other information to the CFPB.

Under the Prepaid Rule, prepaid issuers must make submissions…