Tuesday, June 7, 2011
"We believe increased regulation will help deliver a safe and sound product into the market and bring the prepaid debit card industry into the mainstream," said Jim Tingey, President of the Electronic Banking Division of First California Bank. "As industry standards are adopted and more disclosure is made available to consumers about the fees being charged, both consumers and the corporate world will become more comfortable with this large and growing business."
Tingey's remarks came just a week after the Florida Attorney General's office reported it is investigating allegations of deceptive and unfair business practices at five prepaid card providers – First Data Corp., Green Dot Corp., AccountNow Inc., Netspend Holdings Inc., and UniRush Financial Services LLC.
In the case of AccountNow and UniRush, the attorney general is also investigating the truth of published statements from the two companies that using prepaid debit cards help consumer credit scores.
Earlier this year First California Bank purchased the Electronic Banking Solutions branch of Palm Desert National Bank, along with its products and services that, among other things, includes the prepaid debit card business. First California retitled its newly acquired division Electronic Payment Services. The bank says it is not a target of the Florida attorney general's investigation, nor has it been subpoenaed.
First California Bank emphasizes its debit card products do not offer cardholders overdraft coverage or microloans, which the bank said are notorious in the industry for often having usurious interest rates. 
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