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, and the Consumer Bankers Association filed an amicus brief in support of the defendant.… Continue Reading
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 technical specifications relating to the submission of such agreements.)… Continue Reading
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 Montana law by directing its bank to issue two prepaid cards to the plaintiff to refund credit balances on her account with SCL. … Continue Reading
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.… Continue Reading
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 to the CFPB on a rolling basis, including new prepaid accounts agreements and updates to reflect changes to existing agreements submitted in the past. … Continue Reading
The CFPB’s final prepaid card rule takes effect on April 1. In this week’s podcast, we look at the top ten issues companies should be considering to confirm compliance and discuss how the CFPB and federal banking regulators are likely to approach compliance using their supervisory and enforcement authorities.
Yesterday, the Consumer Financial Protection Bureau (CFPB) released guidance and technical specifications relating to the submission of prepaid account agreements. This information will allow prepaid issuers to start preparing to satisfy one of the Prepaid Rule’s new requirements that, with certain exceptions, all prepaid account agreements be submitted to the CFPB. … Continue Reading
A bill (AB 1428) has been introduced in the California Assembly that would apply to a “business” that uses prepaid cards to make refunds to customers located in California. The bill would require such a business to allow the customer to choose whether to get the refund by prepaid card, check, or a refund back to the original form of payment.… Continue Reading
After several years of rulemaking, amendments, and delays, the CFPB’s Prepaid Rule (the “Rule”) is finally set to take effect on April 1, 2019. This rapidly approaching effective date means that prepaid issuers have only two months left to confirm that their prepaid programs and materials are fully compliant with the Rules’ complex and specific new requirements.… Continue Reading
On January 25, the CFPB finalized certain changes to the original Final Prepaid Rule (the “Rule”) proposed last summer. The amended Rule still contains onerous restrictions on credit features and complicated disclosure requirements, but the changes are generally positive for prepaid providers and incorporate feedback from industry representatives. Importantly, due to concerns about implementation difficulties, the effective date of the Rule, which was originally October 1, 2017 and delayed to April 1, 2018, is now further delayed to April 1, 2019.… Continue Reading