Meet the Big Banks’ Latest Slave Product: “Payroll Debit Cards”

I firmly believe that the biggest domestic policy error over the past generation has been the no-strings-attached bail out of the mega banks in these United States, and their subsequent designation as “too big to fail” and “too big to jail.”  This has given the sociopaths that run these crony organizations a license to steal, and they are doing a great job of it.

So in the latest bank theft product, employers of low income workers are being persuaded to pay their employees via “prepaid payroll cards.”  Not only are these cards typically associated with high fees, but they also discourage employees from using credit unions for their banking needs.

While companies try to defend themselves by saying they are providing a cheaper method for employees that do not have bank accounts to gain access to their funds, in many cases using these “prepaid cards” isn’t simply an option, but a requirement.  Oh, and take a guess why the mega banks are pushing into this line of business?  Prepaid cards are essentially exempt from financial regulation.  Serfs up boy and girls.  From the New York Times:

A growing number of American workers are confronting a frustrating predicament on payday: to get their wages, they must first pay a fee.

For these largely hourly workers, paper paychecks and even direct deposit have been replaced by prepaid cards issued by their employers.

These fees can take such a big bite out of paychecks that some employees end up making less than the minimum wage once the charges are taken into account, according to interviews with consumer lawyers, employees, and state and federal regulators.

Devonte Yates, 21, who earns $7.25 an hour working a drive-through station at a McDonald’s in Milwaukee, says he spends $40 to $50 a month on fees associated with his JPMorgan Chase payroll card.

Anyone surprised that “the morgue” is at the center of this?

“It’s pretty bad,” he said. “There’s a fee for literally everything you do.”

Many employees say they have no choice but to use the cards: some companies no longer offer common payroll options like ordinary checks or direct deposit.

Taco Bell, Walgreen and Wal-Mart are among the dozens of well-known companies that offer prepaid cards to their workers; the cards are particularly popular with retailers and restaurants. And they are quickly gaining momentum. In 2012, $34 billion was loaded onto 4.6 million active payroll cards, according to the research firm Aite Group. Aite said it expected that to reach $68.9 billion and 10.8 million cards by 2017.

For Natalie Gunshannon, 27, another McDonald’s worker, the owners of the franchise that she worked for in Dallas, Pa., she says, refused to deposit her pay directly into her checking account at a local credit union, which lets its customers use its A.T.M.’s free. Instead, Ms. Gunshannon said, she was forced to use a payroll card issued by JPMorgan Chase. She has since quit her job at the drive-through window and is suing the franchise owners.

For banks that are looking to recoup billions of dollars in lost income from a spate of recent limits on debit and credit card fees, issuing payroll cards can be lucrative — the products were largely untouched by recent financial regulations. As a result, some of the nation’s largest banks are expanding into the business, banking analysts say.

The lack of regulation in the payroll card market, while alluring for some of the issuers, can potentially leave cardholders swimming in fees. Take the example of inactivity fees that penalize customers for infrequently using their cards. The Federal Reserve has banned such fees for credit and debit cards, but no protections exist on prepaid cards. Cards used by more than two dozen major retailers have inactivity fees of $7 or more, according to a review of agreements.

Many fees are virtually impossible to dodge, some employees say. A Victoria’s Secret employee, Bintou Kamara, for example, said it cost her $1.50 just to transfer money from her Citi payroll card to her checking account.

Aren’t you glad we bailed them out?

Full article here.

In Liberty,

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  1. …and by the way… payments using these cards are easy for the NSA to monitor.

  2. Bank theft products for the adults and subverting the youth through student loans.

    Have you heard the outcry and massive protest marches by university professors and administrators to immediately stop and abolish the student loan program in the USA that is DESTROYING hundreds of thousands of their students financially and continues unabated?

    Clueless 18 year olds are given huge student loans, permanently nailed to them for life with no recourse to default, that would never be given to them under ANY other circumstances. Raising interest rates of student loans that can’t be defaulted on; what a handy way to pile on more forced funding of government programs!

    And when you hear “student loans will be ‘forgiven’, it means only for certain ‘selected by government’ groups, the debt does not go away. Other people diligent in repaying their loan, but not part of the select, will ALSO have to pick up theirs.

    What? ….there is no outcry from university professors and administrators? …..not even…..anything? to save the financial future of hundreds of thousands of kids? ? No demands from universities to immediately cease and desist the program?

    Oh, they’re keeping quiet and sacrificing their students futures for their own salaries, pension security and fancy offices, bonuses and parties (oops, I mean ‘conferences’ so they can give each other awards for excellence)?

    Your student loan is funding a better life … not yours:

    NYU: As Students Become Debt Serfs, “Star Professors” Buy Homes in East Hampton with University Money

    Posted on June 19, 2013 by Michael Krieger


    The board of trustees has raised his salary to nearly $1.5 million, with a $2.5 million “length of service” bonus to come in 2015, and has guaranteed him retirement benefits of $800,000 a year. The university also provides him an apartment by Washington Square.

    …and now students must ALSO fund Obamacare through increased loan payments:

    CBO: Feds siphoning billions from student loan program to fund Obamacare

    Josiah Ryan






    By Josiah Ryan, on Jun 28, 2013

    The Affordable Care Act is set to cost students enrolled in the government’s loan program $8.7 billion in extra interest over the next decade, according to a report published by the non-partisan Congressional Budget Office (CBO).

    This is outrageous to further burden already financially hammered students. While professors and administrators are living large, many with 6 figure salaries, pensions and perks.

    When will congress stop the predatory student loan program?

    When will students revolt?

    • When Congress, and the government generally, ceases to be a wholly owned subsidiary of the Banking Cartel that controls the nation’s money.
      Students will revolt when they’re hungry.

  3. FACISIM….BIG BUSINESS AND GOVERNMENT TOGETHER………JP MORGAN just another federal department…that joins a group which mostly are UNCONSTITUTIONAL…fed,epa,energy,tsa ,dhs

  4. They’ll be paying workers in tokens soon, only exchangable at “company stores”.

    • That’s just it, Natalie; that’s the way it is now and has been since the implementation of debt money. The US has been a vast, enormously prosperous reservation/plantation/company-town since 1913. So prosperous no one thought much about it. Generations denominated their entire lives in debt-notes created by a network of banks. The debt-notes, or as it says along the top, Federal Reserve Note (a note is a debt), have no innate value: that’s the definition of slavery, giving your labor, getting nothing of value in return.

      Real money in the hands of people is ultimately a democratizing force. Some would say the ultimate democratizing force. Michael’s piece about pay-cards is just another example of anti-democratizing on the part of the TPTB. I’d like to think the courts would overturn it, but the courts forgive the corporations everything at this point.

      Your image is apt, Natalie.

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