Prepaid Card Regulation Rollback

This is constituent Howard Porter’s response:

Roger Williams’ Latest: Doing the Dirty Work for payday prepaid cards

Congress wants to block the Consumer Financial Protection Bureau’s prepaid card rule, and in the House this effort is being lead by Congressman Roger Williams (R-TX25)

The prepaid card rule, issued by the CFPB in October, protects consumers who use prepaid cards to make purchases and manage their money. The rule enhances rights in case of loss, theft, and unauthorized charges – protections already given to Debit Card Holder. And, the rule takes steps towards making sure prepaid cards remain prepaid, rather than a vehicle for high cost credit products or hidden fees.

Any rollback of the protections in the final rules will disproportionately affect low-income and younger consumers, two groups that use prepaid cards in higher number

In Texas, 10.2% of households used prepaid cards in 2015, according to the FDIC, higher than the national average.

The biggest beneficiary of stopping this rule? NetSpend! They charge some $80 million a year in overdraft fees on payday lender prepaid cards. Senators from NetSpend’s home state filed the resolution in the Senate and they’ve gotten Representative Williams to do their bidding in the House.

Rep. Williams has filed a resolution under the Congressional Review Act (CRA) and recruited 34 cosponsors. CRA resolutions allow congress to undo recent rules and protections. The CRA has special provisions to expedite a vote and prevent a filibuster, so if it moves forward it will be a big fight.

A successful use of the CRA now would not only hurt those who use prepaid cards, but would erode the young CFPB’s authority, despite its tremendous success at returning nearly $12 billion to 29 million consumers across the nation.

Post to Facebook or Tweet: (find their twitter handles here)

Let @CFPB do its job: prepaid cards should be prepaid #DefendCFPB #RulesAtRisk [ADD TWITTER HANDLES]

Don’t let @Netspend scam customers by blocking @CFPB’s prepaid rule #DefendCFPB [ADD TWITTER HANDLES]
Don’t use the CRA to let prepaid card buyers get scammed #DefendCFPB #RulesAtRisk [ADD TWITTER HANDLES]

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