To amend the Electronic Fund Transfer Act to provide protection for consumers who have government benefit cards.

Summary: Benefit Card Fairness Act of 2010 - Amends the Electronic Fund Transfer Act (EFTA) to extend its coverage to any account directly or indirectly established through a government agency to which electronic fund transfers (EFTs) are made by or on behalf of a government agency on a recurring basis (government payment account).

Repeals the exemption from EFTA disclosure, protection, responsibility, and remedy requirements of electronic benefit transfer systems established by a federal, state, or local government agency for distributing needs-tested benefits, such as through automated teller machines (ATMs) or point-of-sale terminals.

Requires a financial institution to offer a government payment account in compliance with this Act and with the requirements of the Federal Deposit Insurance Corporation (FDIC) for the provision of insurance to the consumer.

Prescribes requirements for consumer choice in making an EFT to a government payment account, as well as for access to account balance and transaction history.

Prohibits the assessment of specified fees on a government payment account, except certain transaction fees, a nominal fee of up to $1 for written periodic statements, and other permissible fees for specific services beyond ordinary use of the account.

Requires a financial institution to make certain disclosures including: (1) the means to obtain account balance; (2) written account history; (3) fee information; and (4) error resolution.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Benefit Card Fairness Act of 2010''.

SEC. 2. PROTECTION FOR CONSUMERS WHO HAVE GOVERNMENT BENEFIT CARDS.

    (a) Government Payment Accounts Included in Definition of 
Account.--Section 903 of the Electronic Fund Transfer Act (15 U.S.C. 
1693a) is amended--
            (1) in paragraph (2), by inserting ``and includes a 
        government payment account,'' before ``but'';
            (2) by redesignating paragraphs (9) and (10) as paragraphs 
        (10) and (11), respectively; and
            (3) by inserting after paragraph (8) the following:
            ``(9) the term `government payment account' means an 
        account that is directly or indirectly established through a 
        government agency and to which electronic fund transfers are 
        made by or on behalf of a government agency on a recurring 
        basis;''.
    (b) Elimination of Exemption for Government Electronic Benefit 
Transfer Systems.--
            (1) In general.--Section 904(d) of such Act (15 U.S.C. 
        1693b(d)) is amended by striking paragraph (2) and 
        redesignating paragraph (3) as paragraph (2).
            (2) Conforming amendments.--
                    (A) Section 905(a)(10)(A) of such Act (15 U.S.C. 
                1693c(a)(10)(A)) is amended by striking 
                ``903(d)(3)(D)(i)'' and inserting ``903(d)(2)(D)(i)''.
                    (B) Section 910(d) of such Act (15 U.S.C. 1693h(d)) 
                is amended by striking ``903(d)(3)(B)(i)'' each place 
                it appears and inserting ``903(d)(2)(B)(i)''.
    (c) Consumer Protection.--The Electronic Fund Transfer Act (15 
U.S.C. 1693-1693r) is amended by adding at the end the following:

``SEC. 922. GOVERNMENT PAYMENT ACCOUNTS.

    ``(a) In General.--A financial institution shall not offer a 
government payment account except in compliance with this section.
    ``(b) Consumer Choice.--An electronic fund transfer on behalf of a 
consumer may not be made automatically to a government payment account, 
unless--
            ``(1) the consumer has first been offered and has declined 
        the choice of direct deposit to an existing account chosen by 
        the consumer;
            ``(2) the consumer has, when offered the choice of direct 
        deposit to an existing account, been provided a clear and 
        conspicuous list of the types and amounts of all fees and 
        charges associated with the government payment account; and
            ``(3) the consumer has the opportunity, in case of 
        hardship, to opt out of electronic transfer of payments to the 
        consumer and elect to receive payments in the form of a check.
    ``(c) Access to Account Balance and Transaction History.--
            ``(1) A financial institution shall provide the means for 
        the consumer to access the balance of a government payment 
        account through a telephone line, online, and at a terminal 
        (such as by providing balance information, routinely or on 
        request, on a screen or on a receipt from an automated teller 
        machine).
            ``(2) A financial institution shall either provide periodic 
        statements pursuant to section 906(c), or make available to a 
        consumer at a consumer's option all of the following without a 
        fee, except for the fee permitted in subparagraph (E):
                    ``(A) A written history of the consumer's account 
                transactions that is provided promptly in response to 
                an oral or written request and that is available for 
                transactions at least 24-months preceding the date of 
                the request by the consumer.
                    ``(B) An electronic history of the consumer's 
                account transactions, such as through an Internet Web 
                site, that covers at least 60 days preceding the date 
                the consumer electronically accesses the account.
                    ``(C) An electronic periodic statement.
                    ``(D) Electronic mail notification of the 
                availability of an electronic history or an electronic 
                periodic statement at least once each period, unless 
                the consumer has declined to provide an electronic mail 
                address.
                    ``(E) The choice of receiving a written periodic 
                statement upon payment of a nominal fee, not to exceed 
                $1 per statement.
            ``(3) A history of account transactions provided under 
        subparagraphs (A) and (B) of paragraph (1) of this subsection 
        shall include the information required by section 906(c).
    ``(d) Fees.--
            ``(1) In general.--A fee or charge may not be assessed on a 
        government payment account except as authorized by this 
        section.
            ``(2) Prohibited fees.--A fee or charge may not be charged 
        on a government payment account for any of the following:
                    ``(A) The first withdrawal from an in-network 
                automated teller machine and the first withdrawal from 
                a bank teller, after each deposit.
                    ``(B) An application.
                    ``(C) Participation, whether on a one-time or 
                periodic basis.
                    ``(D) An overdraft, including a shortage of funds 
                or a transaction processed for an amount exceeding the 
                account balance.
                    ``(E) A purchase.
                    ``(F) A declined transaction.
                    ``(G) Inactivity.
                    ``(H) An inquiry, or balance or transaction 
                information, at an automated teller machine or through 
                the Internet or an automated system.
                    ``(I) Customer service.
                    ``(J) An ad hoc request for a statement.
                    ``(K) An extension of credit.
                    ``(L) 1 replacement card each year.
                    ``(M) Anything for which a fee is not permitted by 
                or under paragraph (3).
            ``(3) Permitted fees.--
                    ``(A) Nominal fee for written periodic 
                statements.--The consumer may be charged a nominal fee 
                not to exceed $1 for written periodic statements if the 
                fee is designed solely to cover the costs of printing 
                and mailing the statements, and if other account 
                information is made available in accordance with this 
                section.
                    ``(B) Transaction fees.--Subject to subparagraph 
                (C), a consumer may be charged a fee for only the 
                following transactions in connection with a government 
                payment account:
                            ``(i) The second or any subsequent 
                        withdrawal from an in-network automated teller 
                        machine and the second or any subsequent 
                        withdrawal from a bank teller, after each 
                        deposit.
                            ``(ii) A surcharge imposed by a non-network 
                        automated teller machine in compliance with 
                        section 904(d)(3).
                            ``(iii) A transfer to another account.
                            ``(iv) Bill payment.
                            ``(v) A replacement card after the first 
                        one each year.
                            ``(vi) Expedited delivery of a replacement 
                        card.
                            ``(vii) International automated teller 
                        machine withdrawal.
                            ``(viii) A purchase or withdrawal in an 
                        international currency.
                    ``(C) Authority to permit other fees.--The Board 
                may by regulation authorize other permissible fees for 
                specific services beyond ordinary use of the account.
    ``(e) Disclosures.--
            ``(1) In general.--A financial institution shall disclose 
        the following:
                    ``(A) Means to obtain account balance.--The means 
                by which the consumer may obtain information without a 
                fee concerning the account balance, including a 
                telephone number and Web site.
                    ``(B) Written account history.--A summary of the 
                consumer's right to receive a written account history 
                on request and other means to obtain transaction 
                information.
                    ``(C) Fee information.--
                            ``(i) Any fee or charge associated with the 
                        account shall be disclosed in a prominent 
                        location on or in conjunction with any 
                        application or solicitation, or other 
                        applicable document, and in the form of a table 
                        with headings, content, and format 
                        substantially similar to the tables required 
                        pursuant to section 127(c)(1)(A) of the Truth 
                        in Lending Act and regulations under that 
                        section.
                            ``(ii) The card or device used to access 
                        the account shall display a toll-free number 
                        and Web site at which a clear and conspicuous 
                        list of fees and charges may be obtained.
                            ``(iii) The initial disclosure of fees and 
                        charges shall include a wallet-sized summary of 
                        the fees and charges, the Web site where fee 
                        information can be found, and the telephone 
                        number for customer service.
            ``(2) Modified requirements.--The following requirements 
        shall apply to financial institutions that do not furnish 
        periodic statements for the transfers referred to in subsection 
        (c):
                    ``(A) Error resolution.--The financial institution 
                shall provide a notice to consumers concerning error 
                resolution as prescribed in regulations of the Board.
                    ``(B) Limitations on liability.--For purposes of 
                section 909(a), the 60-day period for reporting an 
                unauthorized transfer that appears on a periodic 
                statement shall begin with transmittal of a written 
                account history or other account information, provided 
                to or accessed by the consumer under subsection (c) of 
                this section, in which the unauthorized transfer is 
                first reflected.
                    ``(C) Error resolution.--If a financial institution 
                receives oral or written notice of an error from the 
                consumer within 60 days after the consumer, under 
                subsection (c) of this section, obtains a written 
                account history or other account information in which 
                the error is first reflected, the financial institution 
                shall comply with section 908.
    ``(f) FDIC Insurance.--A financial institution shall not offer 
electronic fund transfer services in connection with a government 
payment account unless the account complies with requirements of the 
Federal Deposit Insurance Corporation for the provision of insurance by 
the Federal Deposit Insurance Corporation to the consumer on either a 
direct or pass-through basis.
    ``(g) Standard State Contracts.--The Secretary of the Treasury, in 
consultation with the Secretary of Labor and the Secretary of Health 
and Human Services, shall promulgate a request for proposals from 
financial institutions for a standard contract into which a State or 
local government agency may enter for government payment account 
services in compliance with this section.
    ``(h) Definition of Financial Institution.--In this section, the 
term `financial institution' means any provider of a government payment 
account.''.
    (d) Effective Date.--
            (1) In general.--Except as provided in paragraph (2), the 
        amendments made by this section shall take effect 1 year after 
        the date of the enactment of this Act.
            (2) Inapplicability to services provided under contracts 
        entered into before enactment.--The amendments made by this 
        section shall not apply with respect to the provision of goods 
        or services under a contract entered into before the date of 
        the enactment of this Act.