Green Dot Mixes Up Prepaid Card Addresses, Ties Up My Money

Sarah bought a Green Dot Visa card at Walmart so she could do some shopping online. Her experience is a great illustration of why this site isn’t a huge fan of prepaid debit cards: she put down cash for a card that had erroneous address information even though she had carefully followed all directions and registered the card. She ended up with most of the card’s balance tied up in transactions she couldn’t complete.

She wrote to Green Dot, and copied Consumerist on her message.

I purchased a Walmart Visa Gift Card in the amount of $50 in order to do some online shopping and have not had much luck using it.

I followed the directions on the packaging and went to walmartgift.com to register my address before making an online purchase and received confirmation of the change. However, when I placed my order it was declined due to the address being incorrect. I double checked the address and tried again. This second transaction was also declined.

I double checked that my address was updated at walmartgift.com and, while it had my address correct, it also now had two pending transactions for $21.99 each which effectively depleted the value of the card.

Concerned that I would be unable to make my purchase, I called the customer service number on the back of the card and, eventually, spoke with a man named [J] who verified that the address associated with the card was not my address but yours. Which was a surprise as wallmartgift.com showed my address for the card. Even more amazingly, as we were speaking, the computer “refreshed” and updated my address.

We then made a conference call to the merchant who verified that the first two charges were declined.

[J] was nice enough to reverse one of the charges which allowed me to complete a transaction (for $21.99) and I should get that order in a week–hurray!

The reason I am taking the time to write you is the second declined transaction (which still shows pending) won’t be reversed until 3/17. This is unacceptable. The delay of the address update in your computer system caused the first two $21.99 transactions to be declined and it is unfair that I should be without my money for almost two weeks due to your companies mistake.

I would like the second pending charge of $21.99 reversed as well so I can get on with my online shopping spree.

Aren’t prepaid cards supposed to simplify the process of getting your hands on plastic to shop with?

Comments

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  1. Invader Zim says:

    Sounds like they are having software/server issues. After having my credit card info stolen from the internet I fully understand why a prepaid card is the way to go. My son also uses them now and has no issues. Its nice to see someone thinking ahead and being cautious. ATTA GIRL

    • Sneeje says:

      Just curious, are you certain your CC info was stolen from the internet? I ask because I’ve had mine stolen three times, and never due to the internet. Once by an unscrupulous server in a restaurant, and the other two by CC mills that guess thousands of CC numbers and try to use them to create small, recurring charges.

      Was it from a data breach?

  2. chefboyardee says:

    Prepaid cards are a great idea. Unfortunately, Visa Green Dot is the biggest POS scam in the world.

    http://www.ripoffreport.com/credit-card-fraud/greendot-visa-master/greendot-visa-mastercard-scam-ppae4.htm

    http://www.topix.com/forum/city/lexington-ky/T7E5B4KN8CK3FC33G

    And so on.

    • Firethorn says:

      Personally, I prefer actual credit cards for the protection – I use discover, and for online transactions I use the custom number generator to get a different number for each retailer.

      Benefits:
      1. A $20-30 hold or bad charge isn’t going to break me. I have time to dispute with the company before I pay
      2. Customer service is more proactive.
      3. I’m working with the company’s money, not my own. Other than settling up once a month(pay in full).
      4. I’m building credit history
      5. Because it’s a long established account, issues such as billing address have already been resolved(though the occasional hiccup can still happen, especially during international travel).

      For the OP – I’d hardly call $30 of remaining balance an opportunity for a ‘shopping spree’. For me, a ‘spree’ would be when I get the parts to assemble a new computer, and runs closer to a grand.

    • Firethorn says:

      On the Ripoff Report story – My thought was that Green Dot Visas ARE Visas, so my first step would be to have my attorney ask Visa to give them Green Dot’s information, adding them as a party to the lawsuit if they aren’t nice enough. The money has to come from/go somewhere.

  3. apple420 says:

    The credit card system at my job works the same way. If an address is incorrect then their bank has authorized the charge, but our bank has not accepted it as a security measure. If they call us we can manually put through the original charge through with an invalid address. The delay before the authorizations disappear does frustrate some customers.

  4. Lucky225 says:

    AVS address takes 24 hours to update, pending authorizations are pending, they will fall off once Greendot realizes the authorization won’t be collected *sigh*.

    • Lyn Torden says:

      The system should not be allowed to work that way. For ONE transaction at a merchant, there should never, EVER, be more than one charge pending. Pending charges should have the transaction number and only one per transaction. If the merchant cancels the transaction, the pending charge must go away, too.

      Better yet, they should just get some faster computers. The TRS-80 is so 1980′s.

  5. Lyn Torden says:

    I blame it on the programmer over in Bangalore.

  6. sarah schmara says:

    UPDATE: The email worked! I got the other charge reversed this morning and continued my online shopping spree. It just ticks me off that I had to go through several customer service numbers and some hard-core googling to do it.

  7. Billy C says:

    Jeeze, I should have written in about my experience with my prepaid Visa, because my story is much worse than hers. Similar situation with transactions declined for an address issue, but it was for three failed transactions with a value each of about ten times what hers were. No matter what I did, who I called using up hours and hours of long distance rates, the funds were held for two weeks before being released. I couldn’t even pay my rent because my entire balance was drained.