Additional Information for Green Dot Corporation

The following describes a government action that has been resolved by either a settlement or a decision by a court or administrative agency.  If the matter is being appealed, it will be noted below.

On July 19, 2024, Green Dot Bank, Provo, Utah (The "Bank") and Green Dot Corporation (the "Holding Company") entered into an Order to Cease and Desist and Order of Assessment of a Civil Money Penalty with The Board of Governors of the Federal Reserve System Washington, D.C.

The review of Green Dot Corporation determined unfair or deceptive acts or practices in or affecting commerce including:

• From November 2017 through January 2021, the Bank engaged in deceptive acts by misrepresenting through General Purpose Reloadable (GPR) prepaid debit card packaging, cardholder agreements, and online disclosures that accounts would be closed after consumers spent their account balances down to zero dollars when, in fact, many accounts remained open despite having a zero-dollar account balance and consumers continued to incur monthly fees.
• From June 2019 through December 2020, the Bank engaged in a deceptive act or practice by misrepresenting through GPR prepaid debit card packaging, point-of-sale advertising, and online disclosures that consumers could register their GPR prepaid debit card accounts by telephone or online when, in fact, consumers could not register the cards by telephone and could only register their accounts online. This violation resulted from the Bank's discontinuation of the telephonic registration option without updating the card packaging, which prevented customers who lacked internet access from registering and using their cards.
• From May 2020 through June 2020, the Bank engaged in unfair acts or practices through its lack of reasonable policies and procedures to permit the Bank's legitimate customers to cure account blocks and obtain access to their funds in their GPR prepaid debit card accounts receiving Washington state unemployment insurance benefits.
• From August 2020 through at least September 2020, due to a third-party payment processor's data migration error, the Bank engaged in an unfair act or practices by failing to timely release extended authorization holds in connection with certain GPR prepaid debit card transactions made by consumers until several days after the settlement of the transaction, reducing the available account balances and denying consumers access to their funds.
• From January 2017 through December 2022, Santa Barbara Tax Products Group ("TPG") a wholly owned nonbank subsidiary of the Holding Company contracted with a third party, a major tax preparer, to offer tax return preparation payment services to the major tax preparer's customers, engaged in a deceptive act by failing to disclose clearly and conspicuously to the major tax preparer's customers the full cost of their tax refund processing fee.

It is ordered the board of directors of the Holding Company take steps to ensure that the Bank complies with supervisory action taken by its federal or state regulators by submitting a BSA/AML compliance program that is acceptable to the San Francisco Reserve Bank, Submit a written program acceptable to the San Francisco Reserve Bank designed to ensure reporting a well-documented methodology for establishing monitoring rules and thresholds appropriate for the Bank's risk profile, Policies, procedures and processes that provide for periodic review of the monitoring rules, effective monitoring of customer accounts and transactions and policies, procedures, and processes with respect to the review and analysis of suspicious activity.

The Board of Governors assessed Green Dot Corporation a civil money penalty of $44,000,000 to The Federal Reserve Bank of Richmond, on behalf of the Board of Governors.

For more details go to: https://www.federalreserve.gov/newsevents/pressreleases/files/enf20240719b1.pdf

According to BBB files Green Dot Corporation has a pattern of complaints concerning service issues and customer service issues.  Specifically, consumers allege that their accounts are being locked and therefore not being granted access to their account or funds for extended periods of time.  Consumers allege receiving little to no customer service support.  Consumers allege experiencing access issues to their direct deposited IRS payments.  Consumers further allege having to send in proof of identity numerous times without resolution.  Consumers further allege problems with gift cards and money cards being emptied prior to being registered or activated.  Consumers allege extended wait times for receiving new banking cards in the mail and/or refunds. Consumers allege being on hold for up to 2 hours and then either receive varying messages from different support staff on the same unresolved issues or being hung up on and/or treated rudely by customer support staff.  BBB contacted Green Dot Corporation on September 19, 2023 and as of October 13,2023 Green Dot Corporation has failed to respond to BBB regarding this pattern of complaints.