Federal Trade Commission Give $1.9 Million in Refunds to Payday Borrowers Who Got Prepaid Cards

by Mercator Advisory Group 0

The Federal Trade Commission is giving payday loan seekers who ended up with prepaid cards a $10 to $15 check as part of a settlement with the marketing companies selling the loans.

More than 110,000 consumers who applied for online payday loans but were tricked into paying for prepaid cards instead will be getting a check in the mail, thanks to a settlement reached by the Federal Trade Commission (FTC). While the total amount being refunded is large—$1.9 million—the checks themselves will be between $10 and $15 each.

This event is another black mark on the prepaid industry’s record. It shows the need for issuers and program managers to be sure that they are doing thorough and on-going due diligence on all of their partners, including marketers, to ensure that these types of situations do not arise.

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