Richard Golomb of Philadelphia class action law firm Golomb & Honik, P.C. is lead
counsel for a proposed class of thousands of former Arizona inmates accusing
Bank of America of charging exorbitant fees to use prepaid debit cards
which were issued to them upon their release. The prepaid cards were used
to return money to prisoners that was confiscated during their arrest
or that they earned through work programs.
lawsuit was filed last week in a federal court in Phoenix. According to the complaint,
the prisoners were given no choice about how to obtain their own money
from their inmate accounts and were forced to accept the fee-laden cards.
The bank is accused of preying on a vulnerable population of people who
come out of incarceration without employment or sometimes even without
a place to go once they have been released.
The lawsuit states that the prepaid debit cards exploit a loophole in federal
regulations that protects the rights of other consumers. Under the U.S.
Electronic Funds Transfer Act, companies cannot force people to receive
wages on prepaid debit cards, but this does not apply to one-time payments
to former inmates.
Because Bank of America owns the exclusive right to provide debit cards
to Arizona inmates, they have been able to impose their own terms until now.
The former prisoners are required to pay fees that ordinary consumers would
not have to pay, such as a $15 fee just to withdraw money at a bank teller
window. "They get charged a fee just to walk up to a teller to find
out how much money they have in their accounts," said Mr. Golomb.
The fees are based on a debit card contract "that they never agreed
to and never signed.”
JP Morgan Chase & Co paid nearly $450,000 to settle a similar lawsuit
involving its contract with the U.S. Bureau of Prisons.
The case is
Brill et al v. Bank of America, U.S. District Court, Arizona District, No 16-cv-3817.