Some pre-paid phone carriers may be illegally seizing money from user accounts, according to consumer reports. It is alleged that in some instances, if customers fail to pre-pay the monthly or daily payment within 60 days, all the money remaining in their account is forfeited. This could be in direct conflict with the recently-passed CARD Act, which stipulates that the value of pre-paid cards cannot expire before five years.
Allegedly in some instances, if customers fail to pre-pay the monthly or daily payment within 60 days, all the money remaining in their account is forfeited.
The CARD Act was signed into law in May, 2009 and it amends the federal Electronic Funds Transfer Act (EFTA). The consumer protection law applies to prepaid card products sold to a consumer on or after August 22, 2010. States may enact laws providing more protection than the CARD Act, but may not drop below the law’s base requirements. The CARD Act states that pre-paid cards, gift cards, and store gift cards must disclose certain information to consumers, as well as restricts most fees and expiration dates. It specifically prohibits cards, codes, and other devices from expiring within five years from the date the card was issued or the date funds were last loaded, whichever is later.
The CARD Act does include certain exemptions, including pre-paid devices redeemable solely for telephone services, but if they can also be redeemed for related technology services, they are included in the Act. Many pre-paid phones include services in addition to telephone, including texting, internet, and email. In addition to this possible widespread abuse of the pre-paid phone system, a lawsuit was also recently filed in Manhattan alleging that Verizon Wireless artificially inflated pre-paid phone activations seeking to make the company seem more profitable than it really was.
If you or someone you know has experienced a situation where money was taken from a pre-paid phone account prematurely, you may be able to enter a lawsuit to recover the money. Fill out the free case evaluation on the right to receive a consultation from a knowledgeable pre-paid phone attorney.