This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Concerns About Prepaid Cards, Wal-Mart Dominate CFPB Town Hall

NEW YORK ( MainStreet) -- The Consumer Financial Protection Bureau hosted a town hall in New York City on Wednesday intended to elicit feedback on banks' overdraft policies, but the event's focus shifted when under-banked consumers took to the microphone to express discontent with their alternatives to traditional checking accounts, namely prepaid debit cards and check-cashing services.

The town hall, held at Hunter College, followed a roundtable discussion that day in which consumer advocates and bank representatives shared their thoughts on the CFPB'S inquiry into the overdraft practices being used by the nation's financial institutions.

The Consumer Financial Protection Bureau's Richard Cordray says the agency will look into concerns about merchants such as Wal-Mart taking part in financial services.

"I switched to a prepaid account to escape overdraft fees ," said Stacey Thompson, a New York resident, in the open forum. "I ended up with a negative balance on that card."

Agency head Richard Cordray did not respond directly to Thompson's complaints about her prepaid account, instead acknowledging that problems with traditional checking accounts can lead consumers to seek out oftentimes inferior solutions.

"Different banks charge different fees," he added later, when another consumer bought up high checking account minimums. "We want it to be easy for consumer to navigate the financial marketplace."

Retail giant Wal-Mart, which both prepaid debit cards and check cashing services, also incurred some criticism with several customers specifically asking the CFPB Director to regulate the retailer.

Cordray explained that federal law does not give the CFPB jurisdiction over merchants, but that the bureau does have the authority to regulate the financial services offered by merchants. He said the CFPB was going to look into the concerns and would "act, if appropriate."

Cordray did not say whether the CFPB planned to regulate the prepaid debit card industry, which has long been criticized by consumer advocates who say the cards offer high fees and low incentives to the unbanked or those who aren't creditworthy.

He did say the bureau would provide guidance to federal and state government agencies in terms of dealing with prepaid providers, after another consumer complained he was required to load his child support payments onto a prepaid debit card that was subject to fees.

"Some of these products are better than others," Cordray said, acknowledging these cards were often used in unemployment benefit programs.

The CFPB did not provide details as to whether additional inquiries into the complaints expressed by consumers at the town hall would be announced formally. CFPB spokeswoman Jennifer Howard did say the bureau expects to have a report and an action plan based on the overdraft inquiry's results available by the end of the year.

>To submit a news tip, email:

Follow TheStreet on Twitter and become a fan on Facebook.

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 17,761.51 -16.64 -0.09%
S&P 500 2,064.33 +3.10 0.15%
NASDAQ 4,743.3640 -5.0320 -0.11%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs