Green Dot Fined $44M

[myrdale]

I was going to post about this last week when the news came out, but I never got around to it.

https://www.nbcnews.com/business/consumer/federal-reserve-fines-green-dot-44-million-customer-funds-fiasco-rcna162771

Green Dot handles some banking services which Walmart provides in the form of pre-paid debit cards. They have been hit by the Federal Reserve for $44M due to numerous allegations of harming consumers.

They crossed my radar a couple years back when a guy in front of me loaded money on his debt card. He wanted to add $50 but was charged about $5. I was dumbfounded by this at the time.

I am of the opinion that most banks don't have your best intentions in mind, but apparently Green Dot is even shadier than most.

[Jluke]

Company has a market cap of 500 million.

that 40 million is a decent amount relative to the cap.

[Jluke]

The Fed identified instances of purported wrongdoing by Green Dot starting in 2017 and continuing through December 2022 that included failing to properly close accounts and assessing fees on them, and denying certain customers access to funds while offering inadequate ways for those customers to redress the issues.

[ua_guy]

Never heard of them. I'm willing to bet having to pay a $44M slap on the wrist was worth whatever wrongdoing they might have been upto. That's one of the issues in the amoral world of business. Fines/penalties need to vastly outweigh and deter seeking gains of wrongdoing for profit, and they often don't...

[myrdale]

Never heard of them. I'm willing to bet having to pay a $44M slap on the wrist was worth whatever wrongdoing they might have been upto. That's one of the issues in the amoral world of business. Fines/penalties need to vastly outweigh and deter seeking gains of wrongdoing for profit, and they often don't...

In this case, you might be surprised.

I had seen another article which said it would have a significant impact on the company. In 10 minutes of searching I can't seem to find that article again. But googling the net worth of Green Dot, it is $510M. So about 9%. I saw another article which stated they had set aside $20M. I don't know if that means they are trying to negotiate the fine or not.