CFPB Issues Compliance Bulletin on Use of Prepaid Cards for Government Benefits

The CFPB today released a compliance bulletin reiterating that the Electronic Fund Transfer Act and its implementing regulation, Regulation E, apply to government benefits accounts with the exception of state and local electronic benefit transfer programs. In addition to summarizing the regulation’s disclosure requirements for government benefit accounts, the bulletin noted that Regulation E prohibits a person from requiring a consumer to establish an account to receive electronic fund transfers with a particular financial institution as a condition of receipt of a government benefit.

While the CFPB’s press release announcing the bulletin’s publication referenced fees associated with government benefits, neither the bulletin nor the regulation address fees associated with government benefits accounts.