Dozens of groups are calling on federal regulators to protect released prison inmates from steep fees they must pay to access their own money via prison-issued payment cards.
People who are released from prison often receive their remaining wages and money sent by relatives on prepaid debit cards — a practice detailed in a Center investigation about prison bankers last year. The cards often carry unavoidable costs that eat into inmates’ meager resources, including weekly account maintenance charges and fees to close the account and get the balance on a paper check.
“Incarcerated people have no meaningful consumer choice and are particularly susceptible to victimization by abusive business practices,” Prison Policy Initiative said in a comment filed last week with the Consumer Financial Protection Bureau.
The CFPB last year proposed new rules aimed at protecting users of prepaid cards, which are similar to bank debit cards but are not attached to a checking account. The proposal would strengthen safeguards for people who receive government benefits on the cards. For example, no one could be forced to receive benefit payments on a specific card without being offered alternatives like direct deposit or a paper check.
Yet the proposal did not mention cards issued to people as they are released from jail or prison. These products are gaining widespread acceptance, according to a survey of state prisons last year by the Association of State Correctional Administrators.
At least 71 groups have submitted or signed comments calling on the bureau to ban the practice of forcing released inmates to use a particular card.