Green Dot Prepaid Visa Card: Fraudulent And Unfair Business Practices

Prepaid Visa cards are popular and can be found near the checkout aisle of most traditional stores like Walmart, Target, CVS, Walgreens and many others. They are especially popular for low income individuals, pensioners, students and people who have suffered credit problems in the past.

The cards allow people to pay bills, make purchases and store money on a card that can be used anywhere when traditional banking is not an option or is less convenient. Whilst the card concept seems incredibly useful, there is one card sold by Green Dot that based on public consumer reports has been subject to fraud and whose business practices disadvantage the consumer and unfortunately Green Dot is doing little to remedy the problems of its consumers other than giving them the run-around.

I was made aware of Green Dot when I was approached by a client who was livid after having a bought a $100.00 Green Dot Visa gift card as a gift. The card was missing numbers so it could not be activated and Walmart refused to refund the sale. Dozens of calls and emails later the issue was not resolved. Green Dot's customer service system is built up such that clients are not able to speak with representatives, but are asked to leave messages or stay in a looping telephone system. Callbacks occur at odd times and contain messages and promises that a supervisor will call back within 24 hours. This never happens. Green Dot is very good at sending emails and apologizing for problems. These emails promise callbacks within 1 business day and the call window is always between the hours of 8am and 9pm which is not very useful. When callbacks are successful, the caller never has authority to handle or resolve the issue and the customer is left in the same position of having literally lost money.

A simple search on the Green Dot Twitter feed, Facebook page and dozens of other online resources reveals an outstanding number of similar complaints. Of most concern is the demographic of people being defrauded. Typically, it is those who really need to access their money.

Problems that seem to be a theme are:

  1. Customers cannot register the card for unexplained reasons and therefore cannot access their money.
  2. The card once opened is missing numbers and therefore the money is not accessible.
  3. The card has a monthly fee which is not disclosed at the time of purchase meaning a $20.00 gift card is only worth $12.05 after the $7.95 charge for using the card.
  4. Once a card has been activated, most of the prepaid money is already gone.
  5. Children who receive the gift card are unable to use it without supplying a social security number or a driver's license. Most children don't have licenses and shouldn't be handing out their social security numbers.

The Twitter and Facebook feeds are heartbreaking and the desperate words of people who really need the $200 to $300 that they put on their cards. Green Dot doesn't resolve these issues and if consumers want to file a legal challenge, they must pay $200 to file a complaint in arbitration because unbeknownst to them, once you buy a Green Dot card you have automatically agreed to arbitration.