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 its bank to issue two prepaid cards to the plaintiff to refund credit balances on her account with SCL. … Continue Reading

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

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

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.

Click here to listen to the podcast.… 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

The New Jersey Legislature is considering a law to restrict prepaid-account fees.  Assembly Bill 4965 ( the NJ Bill) seeks to impose fee constraints, disclosure mandates, and limits on consumer liability for unauthorized transfers, among other things.  While many aspects of the proposed law mirror the Consumer Financial Protection Bureau’s Final Prepaid Rule (the Bureau’s Prepaid Rule), the NJ Bill’s fee restrictions and disclosure mandates exceed federal requirements set to go into effect on April 1, 2018. … Continue Reading

The CFPB has issued its long-anticipated final rule for general purpose prepaid accounts.  As expected, the new regulations expand the products covered by Regulation E, introduce significant new disclosure requirements, extend consumer liability protections to prepaid accounts and add onerous requirements for accounts with overdraft or credit features.  Many industry participants have already expressed disappointment with the CFPB’s decision to apply Regulation Z requirements to the overdraft features of prepaid accounts. … Continue Reading

The CFPB released a report, “Tools for saving: Using prepaid accounts to set aside funds,” that presents the results of a research project involving a pilot program offering an incentive to prepaid card users to use a savings feature.

In December 2014, as part of its Project Catalyst, the CFPB’s initiative for facilitating innovation in consumer-friendly financial products and services, the CFPB announced a new research pilot program using insights from behavioral economics and an American Express pilot program to evaluate the effectiveness of certain practices to encourage prepaid card users to develop regular saving behavior.… Continue Reading

The CFPB has issued its February 2016 complaint report which highlights complaints about prepaid cards and complaints from consumers in Texas and the Houston metro area.  The CFPB began taking complaints about prepaid cards in July 2014.

General findings include the following:

  • As of February 1, 2016, the CFPB handled approximately 811,700 complaints nationally, including approximately 21,800 complaints in January 2016. 
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