Green Dot MoneyPak PIN Product Out of Market by Q1 2015 (July 17, 2014)
Green Dot Corp., a Pasadena, Calif.-based provider of prepaid debit card products and reloading services, is discontinuing the MoneyPak PIN method of reloading cards, moving fully to the card swipe reload process, according to a written statement provided yesterday at a hearing of the Senate Special Committee on Aging. Earlier in the year, Green Dot announced its plans to focus its ongoing efforts in reload to the “swipe at the register” method.
The MoneyPak PIN product had become popular in recent years with fraudsters who misused the product to, among other things, perpetrate scams targeting elderly victims. In its testimony, Green Dot outlined several ways it has combatted victim-assisted fraud, including developing technology to help identify suspicious transactions and reprinting all MoneyPak packaging with large red warning notices urging consumers to never give out their PIN. The company said its efforts to combat inappropriate use of MoneyPak PIN have reduced fraudulent activity, but it chose to discontinue the product entirely because of “our inability to completely eradicate this nefarious use of our MoneyPak PIN product.” According to Green Dot, swipe reloading is safer because it requires the cardholder to be present with his card in the store to reload.
Green Dot says eliminating the MoneyPak PIN won’t stop con artists from preying on vulnerable people, but it will stop them from being able to use a Green Dot MoneyPak to help facilitate their scam. The company added, while scams involving MoneyPak make up only a tiny percentage of the volume transacted through MoneyPak, the potential financial harm against any one victim is not worth the risk.
Green Dot tells Paybefore that the vast majority of reloads on Green Dot prepaid cards today already are facilitated through its SwIT technology, not MoneyPak. “So, while it’s true that many honest users of MoneyPak will be negatively impacted by MoneyPak’s phase-out, the financial impact to Green Dot Corporation is expected to not be material. In any event, when it comes to protecting consumers, Green Dot will always put the customer first.”
The MoneyPak PIN product already has been removed from Walmart and many other Green Dot retailers, and it will be completely unavailable by the end of the first quarter of next year, according to the Green Dot statement.
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