The makers of the RushCard, a company owned by Def Jam co-founder and hip hop mogul Russell Simmons, were one of five prepaid debit card companies subpoenaed by the Florida Attorney General’s Office over claims they may be forcing consumers to pay hidden fees each time they make a purchase.
The investigation, which is being overseen by Florida Attorney General Pam Bondi through the Economic Crimes Division, will determine if some of these companies misrepresented their products by promising to improve credit scores, reports mybanktracker.com.
First Data Corporation, Green Dot Corporation, Account Now, Inc., Netspend Corporation and Simmons’ company, Unirush Financial Services, LLC were all named in a press release issued by the Florida Attorney General’s office in May.
Also at that time, Simmons’ company released a statement in response to the subpoena defending the transparency of the RushCard and welcoming all debate and questions.
“RushCard is the solution for people who want affordable financial services that they can customize to suit their needs,” Simmons stated. “As I look at the payments landscape, I see the banks as the large record chains and my RushCard is looking a lot more like iTunes. I welcome the public debate because the more educated the consumers are the more successful we become.”
More than 60 million Americans currently use the RushCard, which can be used anywhere Visa debit cards are accepted. Its website boasted that RushCard holders would pay no more than $15.90 using its prepaid debit card in comparison to the $40.67 and $41.88 they’d pay on checking account and check cashing store services, respectively.