Florida's attorney general said Thursday that she is investigating five prepaid card companies for their fee disclosure practices.
The agency's economic crimes division issued subpoenas to Green Dot Corp., NetSpend Holdings Inc., UniRush LLC, AccountNow Inc. and First Data Corp., the agency said in a press release.
In addition to seeking information about "possible hidden fees" on prepaid cards, some subpoenas also request information about services that claim to improve consumers' credit scores.
"Failing to disclose fees is essentially stealing money from consumers," Florida Attorney General Pam Bondi said in the release. "We will aggressively investigate these practices and ensure that Floridians are protected from hidden fees and charges."
A spokesman for UniRush, the company started by media mogul Russell Simmons, said in an email that it had not received the subpoena and that its fees are transparent on its website. A spokesman for First Data, a unit of the private-equity firm Kohlberg Kravis Roberts & Co., said the company is reviewing the subpoena but had no comment.
Steve Streit, the chairman, chief executive and president of Green Dot, said in a statement provided by a spokeswoman that the company's "fee policies and disclosures are well vetted and well regarded" and that Green Dot is "supportive of the Florida AG's inquiry and will certainly respond promptly."
Prepaid cards function like regular debit cards but are not tied to a checking account. Companies like NetSpend, UniRush and Green Dot often charge a monthly maintenance fee for servicing customer accounts as well as fees for conducting certain ATM and card reload transactions.
Some companies also charge fees for conducting point of sale transactions.
Copies of the attorney general's subpoenas requested that the companies provide a prepaid card package, agreements between the companies and their bank issuers, cardholder agreements, policies for handling consumer complaints and other information.
Dan Henry, the chief executive of NetSpend, said in a statement provided by a spokesman that the company designs its marketing materials and consumer disclosures to "meet or exceed all of the requirements of applicable federal and state law."
"We are confident that any objective review of our programs and materials will result in the same conclusion," Henry said.
