Russell Simmons believes in today's world you have to have plastic.
In fact, the iconic hip-hop mogul envisioned everyone in the country "to have access to the American Dream" with the creation of his RushCard. However for Simmons, his pre-paid Visa card has recently faced scrutiny from the Florida Attorney General's Office, claiming the card may be forcing consumers to pay hidden fees each time they make a purchase.
According to a press release issued by the Florida Attorney General's, subpoenas were issued against five prepaid card companies including First Data Corporation, Green Dot Corporation, Account Now, Inc., Netspend Corporation, and Unirush Financial Services, LLC (makers of Simmons' RushCard) for "possible deceptive and unfair practices."
"Failing to disclose fees is essentially stealing money from consumers," said Attorney General Bondi. "We will aggressively investigate these practices and ensure that Floridians are protected from hidden fees and charges."
The complaints also state that the companies servicing prepaid debit cards often fail to disclose numerous fees in their advertising. Claiming in some instances, every transaction a consumer makes using a prepaid debit card may be subject to a hidden fee.
"I completely welcome any and all debate, discussion and understanding about the best companies in the prepaid debit card industry, which my RushCard company helped found," the Def Jam Records founder responded in a statement. "The RushCard is extremely transparent in terms of the presentation of its fees and its services. All of the information is available for everyone to see on rushcard.com."
To Simmons' credit, the advertising for his RushCard is very transparent in its messaging.
After watching 20 seconds of the check card's commercial (see below) it was made clear that no credit check is needed, everyone is eligible to sign-up, and no bank account is needed. Adding that some fees and restrictions "may" apply.
"As a leader in this industry, I encourage a full understanding of RushCard's transparent pricing, and valuable services, especially for those who have been turned away or let down by traditional banks," he clarified. "RushCard is the solution for people who want affordable financial services that they can customize to suit their needs ...I welcome the public debate because the more educated the consumers are the more successful we become."
Much like traditional debit cards, prepaid debit cards can be used wherever major credit cards are accepted. Leaving consumers to spend only what they have deposit.
I agree with you all. Aren't most Americans already in perpetual debt because of the hidden fees and interest rate calculations that you have to be a mathematician to figure out?
I keep one prepaid debit card to make online purchases, it a Western Union Card. It cost $4.00 load the card and there is a $.00 charge for purchase transaction fees; I don't buy online all the time and prefer paying the fee rather than have my bank card out there like that when I do because if the the truth be told, it is just as often that someone working customer service, etc., are the ones that are stealing account information in the first place..
But ... it seems to me like the authorities ARE going after 'the big guys' ... although they're not specifically banks, necessarily ... but, major financial corporations (the same thing) that are bilking people out of their hard-earned money!! I mean ... even if they were to plaster each and every LEGITIMATE fee that they charge people on their foreheads at the time of purchase .... those cards are STILL a RIPOFF!!
(Although I happen to totally agree with Sunnubian's method and reason for why she uses hers!! I do the same thing but with a AAA (auto club) prepaid that only charges about half those crazy fees!)
If Russell Simmons is above-board, then he's got nothing to worry about!! However, I think it's interesting that his card is put into the same category as those other "big baller" companies (Green Dot services the CVS/Rite Aid, AT&T, and Wal-Mart corporations versions of the 'prepaid card' ... which means they're in the "big leagues" ... and, obviously, so is Simmons!! ).
Come to think of it, wasn't it Russell Simmons who actually popularized the prepaid card in the first place? As I remember, the prepaid card was a reality but few people knew about it, especially, your average working class/working poor, and then Simmons started advertising his prepaid card all over the place, then BAM! EVERYONE and their mama had a prepaid card to offer. Besides, shouldn't any hidden fee charges be the fault of thoseactually setting the charges and fees in the first place, and not the fault of their hype-man? I mean, just because my VISA or MASTERCARD prepaid card has the Disney World name/logo on it, that doesn't mean that Disney World, Inc. or Mickey Mouse is setting the fees, right?
Actually, sunnubian .... I think you're thinking about Magic Johnson who was the first person that I can remember that was hawking that initial "prepaid card" to Black people YEARS ago ... promising that it could do great things for them like improve their credit rating and give them "control" over their finances!! It was a RIPOFF then just like it is now.
He was also the first one that started bilking/pimping (Black) people on that "Rent-A-Center" scam .... where they just had an investigation (and I think a lawsuit) over things like 'hidden fees' and people being charged double what they were originally supposed to pay or having their furniture repossessed for the slightest little infraction or late payment.
I would agree with you that they should be going after the actual card issuer instead of the "spokesperson", though, for issues concerning what is essentially fraud. But, then again, I'm not sure exactly how these cards are set up ..... the article keeps referring to the "Rush card" as HIS (Russell's) card ... and is saying that the company being investigated are the "makers of Simmons' card'.
So, I have to wonder just how involved he is in the process. I mean ... is he like really the owner of the card?? Is he the one who calls the shots as far as how it's distributed, what is charged and is the one who is COLLECTING all associated revenues??