NCL praises New York Attorney General for opening investigation into prepaid cards – National Consumers League
July 3, 2013
Contact: Ben Klein, NCL Communications, (202) 835-3323, benk@nclnet.org
Washington, DC— The National Consumers League (NCL), the nation’s pioneering consumer and worker advocacy organization, applauds New York Attorney General Eric Schneiderman for launching an investigation into retail giants that use prepaid cards to pay their employees. Among the businesses being investigated are Walmart, McDonalds, Home Depot, and Walgreens. The investigation will examine the three ways in which these companies pay their employees: paper check, direct deposit, and prepaid cards. Under New York state law, employees must give their consent to be paid by payroll cards and acceptance of this form of payment cannot be a condition of employment.
Recent reports have shown that there are many additional fees associated with the use of such cards, including withdrawal fees, replacement fees, inactivity fees, and a fee for requesting a paper statement. According to the Federal Reserve, the prepaid card is the fastest growing non-cash method of payment. Banks are eager to partner with businesses that use these prepaid cards because of the fees associated with them.
“This is outrageous. Most of these employees are not paid a livable wage; the last thing they need is the additional burden of onerous fees further reducing their already meager wages. NCL encourages Attorneys General in other states to follow Mr. Schneiderman’s lead,” said Sally Greenberg, NCL Executive Director.
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About the National Consumers League
The National Consumers League, founded in 1899, is America’s pioneer consumer organization. Our mission is to protect and promote social and economic justice for consumers and workers in the United States and abroad. For more information, visit www.nclnet.org.
