N.Y. attorney general probes payroll cards over fees

http://www.reuters.com/article/2013/07/03/us-attorneygeneral-payroll-idUSBRE96206D20130703

By Karen Freifeld
New York | Wed Jul 3, 2013

(Reuters) - New York is investigating some of the country's largest companies over their use of cards to pay hourly employees, a person familiar with the matter said on Wednesday.

New York Attorney General Eric Schneiderman sent letters on Tuesday to more than 20 companies asking for information on their use of the payroll cards, the person said.

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The probe by Schneiderman comes after complaints from workers and advocacy groups about fees associated with the cards, said the source, who was not authorized to speak publicly about the matter. It was first reported by the New York Times.

The cards, which have grown in popularity in lieu of paper paychecks and direct deposit, can carry a host of fees, such as 50 cents or $1 for a balance inquiry and $1.50 for an ATM withdrawal.

They may appeal to low-wage workers who do not have bank accounts.

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Payroll card issues came into the public eye last month after a Pennsylvania woman sued a McDonald's franchisee over its use of them.

Natalie Gunshannon said she was required to get her wages through a JP Morgan Chase Payroll card that carried fees, including $1.50 for each ATM withdrawal and $1.00 for each balance inquiry, according to the lawsuit.

----- [If you are making a low wage, these fees really hurt you.]