On Jan. 16, 2013, the office of Florida Attorney General Pam Bondi reported its settlement with five prepaid card providers over alleged unclear disclosures and misleading statements made to consumers. The office said the "first-of-its-kind" settlements with Account Now Inc., First Data Corp., Green Dot Corp., NetSpend Corp. and Unirush LLC require the companies to institute reforms to their business practices and donate a total of $115,000 to the Central Florida Chapter of Junior Achievement (JACF).
Bondi's office said the attorney general's Consumer Protection Division investigated the prepaid card providers' business practices to determine whether the companies were clearly disclosing fee schedules to consumers and not misleading consumers about how they could build credit ratings by using prepaid cards.
Like other states before it, Mississippi has taken up the task of changing its unclaimed property laws to bolster state revenues. The legislature's attempt to repeal the current law and implement changes is partly designed to remove the exempt status of "gift certificates" from the ranks of abandoned property that can be claimed by the state after a dormancy period has lapsed.
HB 249, introduced Jan. 14, 2013, by Rep. Mark Baker, R-74th District, would establish a dormancy period for "gift certificates" of three years and a reporting requirement for gift certificate issuers. The bill said that, after that three-year dormancy period had expired, "the amount abandoned is deemed to be sixty percent (60%) of the certificate's face value."
According to gift card rating site ScripSmart Inc., no legal definition exists of what constitutes a gift card or gift certificate in Mississippi.
The American PrePaid Phonecall Association voiced concern that a potential decision by the Federal Communications Commission would have an adverse impact on the users of prepaid long-distance phone cards. The FCC is reportedly weighing whether to uphold a ruling made by its Wireline Competition Bureau to allow pay phone operators to bill prepaid card providers for calls made by prepaid card users from pay phones, even if the calls were not completed.
The end result would be prepaid companies would have to offset the costs of the pay phone charges by raising the price of phone cards for consumers, according to the APPPA. "If this ruling is affirmed by the full commission, the impact will be the greatest on those who can afford it the least," said Gene Retske, Executive Director of the APPPA.
BillMyParents Inc., the teen payment solutions brand of Socialwise Inc., raised net proceeds of $4,866,191 via a repurchase of its common stock priced at 40 cents per share and offered to a group of private investors. BillMyParents said the funding will be used for company growth and development.
Green Dot Corp. introduced its mobile device-based GoBank. The app allows Green Dot prepaid card accountholders to send and deposit funds, create budgets and find fee-free ATMs. Green Dot founder and Chief Executive Officer Steve Streit said GoBank is as "intimate and addictive as checking Facebook or texting friends."
InComm subsidiary Medagate Corp. unveiled what it called the first dual-network health-care spending card. The MasterCard Dual Value Health Card combines a member/employee health care funding purse with a restricted-spend purse for targeted items (such as flu shots, prenatal vitamins or smoking cessation products) and incentives.
Money transfer specialist MoneyGram reported it had surpassed 20,000 agent locations in Africa. MoneyGram said the expansion was a result of its partnership with African money exchange provider, Express Exchange.
Corporate prepaid card provider PEX Card unveiled PEX Mobile, a suite of mobile apps designed for businesses with mobile workforces, such as fleet drivers and contractors. PEX Card said corporate administrators can use the apps to approve funds for important company expenses immediately, enable or limit spending in real time, and suspend employee card use.
Cloud-based checking account replacement service provider Plastyc Inc. launched its Powered by Plastyc platform to offer prepaid card services via such businesses as banks, payroll firms and wireless telecommunication providers. Plastyc said it launched the platform in November 2012.
Plastyc also added check cashing functionality to its platform. The company is leveraging Green Dot's reload network accessed via Wal-Mart Stores Inc. locations in the United States. The service is available to UPside Visa prepaid card users.
Prepaid card program manager Synchology LLC launched its flagship product, The Jump Visa Prepaid Card. The general-purpose reloadable (GPR) card is targeted at mainstream banking consumers. It sports features not found in many bank accounts, including flexible transaction management and budgeting tools, rewards, and merchant discount offers.
New York-based prepaid card program outsourcer Ubiquity Global Services signed a multiyear agreement to provide program management for the GPR card program of Univision Enterprises, a division of Spanish language media company Univision Communications Inc. Ubiquity will provide bilingual customer support services from its contact centers in San Salvador, El Salvador, and Manila, Philippines.
Atlanta-based processor WorldPay US Inc. reported it will start processing payments transacted using the PayPal Inc.-branded prepaid card beginning in the spring of 2013. WorldPay said PayPal's prepaid card extends the speed, simplicity and security of PayPal's digital wallet.
Maritime payroll enabler Cardplatforms LLC teamed with ATMSafe, the cash insurance division of Global Benefits Group, to allow Cardplatforms' CrewCash Card users to have cash replaced in accounts if cardholders suffer financial losses when using ATMs.
A collaboration between tax preparation specialist H&R Block Inc. and remote deposit capture provider Chexar Networks Inc. will allow H&R Block Emerald prepaid card users to deposit checks to their card accounts via self-service kiosks and mobile devices.
Watch2Pay, the contactless, prepaid account-enabled wristwatch collaboration between MasterCard Worldwide and watch manufacturer LAKS, will roll out the watch through U.S. financial institutions that deploy TransCard LLC's prepaid card programs. Watrch2Pay was introduced in Europe in December 2011.
Sightline Interactive, a GPR card provider and Sightline Payments LLC subsidiary, agreed with Las Vegas-based Bally Technologies to extend prepaid card functionality to TITO kiosks and online gaming sites. Cardholders will be able to prefund accounts online or via the kiosks.
TransCard's acquisition of HQ Gift Cards, the prepaid card program management division of Ceridian Stored Value Solutions, provides TransCard with a new retail distribution channel for its prepaid products. HQ Gift Cards manages gift card programs for malls.
Canada-based prepaid card provider DirectCash Payments Inc. named Brenda Hughes as Chief Financial Officer of DirectCash. Hughes was hired by DirectCash in July 2012 and was reportedly integral to the acquisitions completed by DirectCash in 2012.
To support anticipated growth, Toronto-based prepaid card processor SelectCore Ltd. restructured its executive management team, which included the appointment of Kevin Taylor as the new CEO. SelectCore said Taylor's 20-plus years of experience in senior management positions at companies in Latin America and the Caribbean has already bolstered the company's next growth phase. Taylor will also continue to serve on SelectCore's board of directors.
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