Consumer complaint received 2020-02-28
Company: Netspend Corporation
State: CA
Product: Credit card or prepaid card
Sub-product: General-purpose prepaid card
Issue: Unexpected or other fees

Complaint:
I am XXXX XXXX. 
I was using Transact prepaid MasterCard by NetSpend under XXXX Card number is XXXX XXXX XXXX XXXX Every time customer adds a card in a merchant website, the merchant payment gateway under MasterCard API internet protocol rules uses {$1.00} debit to test if card is valid, open and has balance to spend. It is a small reversible fee that is dropped or reversed very quickly within 24 hours everywhere visa or mastercard is accepted. 
It is a standard business practice in gas stations as well for example. 
Gas company would charge {$1.00} and reverse it and post gas charge which you pay gas price plus {$0.00} per gallon for using your card as oppose to cash purchase. 
You don't pay additional to that {$0.00} per gallon card transaction fee for being tested by {$1.00} and what I mean by that is {$1.00} reversible temporary charge and you also pay {$1.00} fee for being tested by {$1.00} reversible temporary charge. 
This {$1.00} testing charge protocol is a protected norm in business world and protected under banking mandate and regulated not to be taken by mistake and be abused like a purchase and be put a charge fee on it as if it is a purchase of a goods or services. 

This is openly violated by Transact prepaid mastercard by XXXX taking away the trust of thousands of consumers nationwide and needs to be dealth with fines and penalties by authorities to make them get in line with banking mandates and in full compliance with the law to full extend. 

when I add my card into my XXXX account and I have 2 accounts and I add in both, each account tested with {$1.00} and I was facing {$2.00} and {$2.00} in a row. 
That {$2.00} fraudulent charge consists of {$1.00} supposed to be temporary charge for testing and {$1.00} fee abused by XXXX XXXX is engaged in mass fraud and I want authorities to fine them and send a notice for compliance and exclude first time card addition testing {$1.00} small test charge from being charged with a fee because that is not a valid purchase of good or service and it is only there for purpose of establishing connection between merchant and the bank. 

The other misclassification and ill interpretation of fee happened in pin purchase. 
I used my card information for XXXX prepaid cellphone plan refill account billing page, there was no actual pin or need to enter pin and it is simple charging the card and banks charges merchant percentage for transaction so it makes the money and doesn't need to pass additional cost charge or fee to customer. 

I got charged {$1.00}. 

Unfortunately this as well is being abused in mass by XXXX and I want authorities to fine then and put them in line with banking mandates and in full compliance with the law. 

I feel the urgent need of fines and penalties for them to make immediate stop of abuse of fees by XXXX.

Company public response: Company has responded to the consumer and the CFPB and chooses not to provide a public response
Company response to consumer: Closed with explanation