text: SECTION 1. SHORT TITLE.
  
      This Act may be cited as the ``Prepaid Card Consumer Protection Act 
  of 2010''.
  
  SEC. 2. DEFINITIONS.
  
      (a) Definition of ``Account''.--Section 903 of the Electronic Fund 
  Transfer Act (15 U.S.C. 1693a) is amended by striking paragraph (2) and 
  inserting the following:
              ``(2) the term `account'--
                      ``(A) means--
                              ``(i) a demand deposit, savings deposit, or 
                          other asset account (other than an occasional 
                          or incidental credit balance in an open end 
                          credit plan as defined in section 103(i) of 
                          this Act), as described in regulations of the 
                          Bureau, established primarily for personal, 
                          family, or household purposes, including a 
                          payroll card account, as defined by the Bureau 
                          by rule; and
                              ``(ii) a spending card account, as defined 
                          in section 924(a); and
                      ``(B) does not include an account held by a 
                  financial institution pursuant to a bona fide trust 
                  agreement;''.
      (b) Definition of ``Financial Institution''.--Section 903(9) of the 
  Electronic Fund Transfer Act (15 U.S.C. 1693a(9)) is amended by 
  striking ``holds an account'' and inserting ``provides or holds an 
  account containing funds''.
      (c) Technical and Conforming Amendments.--Section 903 of the 
  Electronic Fund Transfer Act (15 U.S.C. 1693a) is amended--
              (1) by redesignating paragraph (4) (relating to the Board 
          of Governors of the Federal Reserve System), as so designated 
          by section 1084(2)(A) of the Dodd-Frank Wall Street Reform and 
          Consumer Protection Act (Public Law 111-203; 124 Stat. 2081), 
          as paragraph (3); and
              (2) in paragraph (3), as so redesignated by paragraph (1) 
          of this subsection, by striking ``term `Bureau' means the 
          Bureau of Governors'' and inserting ``term `Board' means the 
          Board of Governors''.
  
  SEC. 3. SPENDING CARD ACCOUNTS.
  
      (a) Spending Card Accounts.--The Electronic Fund Transfer Act (15 
  U.S.C. 1693 et seq.) is amended--
              (1) by redesignating section 923 (15 U.S.C. 1693 note), 
          relating to the effective date of the Electronic Fund Transfer 
          Act, as so designated by section 1073 of the Dodd-Frank Wall 
          Street Reform and Consumer Protection Act (Public Law 111-203; 
          124 Stat. 2060), as section 925;
              (2) by redesignating section 922 (15 U.S.C. 1693r), 
          relating to exemptions for State regulation, as so designated 
          by section 1073 of the Dodd-Frank Wall Street Reform and 
          Consumer Protection Act (Public Law 111-203; 124 Stat. 2060), 
          as section 923; and
              (3) by inserting after section 923, as redesignated by 
          paragraph (2), the following:
  ``Sec. 924. Spending card accounts
      ``(a) Definition.--For purposes of this section, the term `spending 
  card account'--
              ``(1) means an asset account, other than as defined in 
          subparagraph (A)(i) or (B) of section 903(2)--
                      ``(A) that is established by a consumer or on 
                  behalf of a consumer;
                      ``(B) that contains the funds of a consumer;
                      ``(C) to which payments are to be made by a 
                  consumer, or at the direction of a consumer;
                      ``(D) to which recurring electronic fund transfers 
                  may be made, at the direction of a consumer; or
                      ``(E) from which payments may be made at the 
                  direction of a consumer through the use of a card, 
                  code, or device;
              ``(2) includes an asset account described in paragraph 
          (1)--
                      ``(A) that is operated or managed by a financial 
                  institution, or any other person; and
                      ``(B) the funds of which are--
                              ``(i) pooled with the funds of a person 
                          other than the person who established the 
                          account; or
                              ``(ii) held in a name other than that of 
                          the person who established the account; and
              ``(3) does not include--
                      ``(A) a nonreloadable general-use prepaid card, as 
                  defined in section 915(a)(2)(A), in an amount that does 
                  not exceed $250;
                      ``(B) a general-use prepaid card, as defined in 
                  section 915(a)(2)(A), that is solely associated with--
                              ``(i) a health plan to which section 105 of 
                          the Internal Revenue Code of 1986 applies;
                              ``(ii) a qualified transportation fringe, 
                          as defined in section 132(f) of the Internal 
                          Revenue Code of 1986;
                              ``(iii) a health savings account, as 
                          defined in section 223(d) of the Internal 
                          Revenue Code of 1986; or
                              ``(iv) any other healthcare benefit 
                          account, including a healthcare account 
                          relating to Medicare or Medicaid benefits;
                      ``(C) a gift certificate, as defined in section 
                  915(a)(2)(B);
                      ``(D) a store gift card, as defined in section 
                  915(a)(2)(C);
                      ``(E) an electronic promise, plastic card, or 
                  payment code or device described in clause (i), (v), or 
                  (vi) of section 915(a)(2)(D);
                      ``(F) a nonreloadable card labeled as a gift card 
                  and marketed solely as a gift card; or
                      ``(G) a nonreloadable loyalty, rebate or 
                  promotional card.
      ``(b) FDIC Insurance.--
              ``(1) Insurance required.--A financial institution may only 
          offer electronic fund transfer services in connection with a 
          spending card account if the account is insured under, and 
          complies with the requirements for pass-through deposit 
          insurance under, section 11 of the Federal Deposit Insurance 
          Act (12 U.S.C. 1821).
              ``(2) Transfer of funds.--Any person that accepts funds in 
          connection with an electronic fund transfer to a spending card 
          account shall promptly, and in no event later than 24 hours 
          after the person accepts the funds--
                      ``(A) transfer such funds to an account at an 
                  insured depository institution (as defined in section 
                  3(c) of the Federal Deposit Insurance Act (12 U.S.C. 
                  1813(c))); or
                      ``(B) credit the spending card account an amount 
                  equal to the amount of such funds.
      ``(c) Alternative to Periodic Statement.--
              ``(1) Periodic statement not required.--In the case of an 
          electronic fund transfer from a spending card account, a 
          financial institution shall not be subject to the requirement 
          under section 906(c) to provide a periodic statement to a 
          consumer, if--
                      ``(A) the financial institution provides to the 
                  consumer--
                              ``(i) access to the account balance of the 
                          consumer--
                                      ``(I) through a readily available 
                                  telephone line;
                                      ``(II) through the Internet; and
                                      ``(III) at an electronic terminal 
                                  or other device that allows the 
                                  consumer to make a balance inquiry, by 
                                  providing balance information or, 
                                  routinely or upon request, on a receipt 
                                  provided at the electronic terminal at 
                                  the time of an electronic fund 
                                  transfer;
                              ``(ii) notice of the means by which the 
                          consumer may access the account balance of the 
                          consumer, including any telephone number;
                              ``(iii) in response to an oral or written 
                          request of the consumer, a written record of 
                          the account transactions of the consumer during 
                          the 2-year period ending on the date of the 
                          request that includes the information required 
                          to be provided to the consumer under section 
                          906(c);
                              ``(iv) an electronic record, such as a 
                          record available on the Internet, of the 
                          account transactions of the consumer during the 
                          60-day period ending on the date on which the 
                          consumer accesses the electronic record that 
                          includes the information required to be 
                          provided to the consumer under section 906(c);
                              ``(v) with at least the same frequency as a 
                          written periodic statement that would otherwise 
                          be required under section 906, notification by 
                          email of the availability of an electronic 
                          history or an electronic periodic statement, 
                          unless the consumer has declined to provide an 
                          email address;
                              ``(vi) the option to receive a written 
                          periodic statement and notice of such option;
                              ``(vii) annual notice of the error 
                          resolution procedure for the spending card 
                          account, as prescribed in regulations of the 
                          Bureau; and
                              ``(viii) any other transaction information 
                          that the financial institution elects to make 
                          available and that the consumer elects to 
                          receive, such as messages or alerts concerning 
                          balance levels or account activity; or
                      ``(B) the consumer does not provide a valid address 
                  to the card issuer.
              ``(2) Fees prohibited.--
                      ``(A) In general.--Except as provided in 
                  subparagraph (B), a financial institution may not 
                  charge a fee for any service provided under paragraph 
                  (1).
                      ``(B) Fee for written periodic statement.--A 
                  financial institution may charge a fee of not more than 
                  $1 for each written periodic statement provided under 
                  paragraph (1)(A)(vi).
              ``(3) No election by consumer.--If a consumer does not 
          provide an email address to a financial institution and does 
          not elect to receive written periodic statements under 
          paragraph (1)(A)(vi), the financial institution shall provide a 
          written statement to the consumer at least once each year, at 
          no cost to the consumer, that contains the date, source, and 
          amount of each transaction made or fee charged, together with 
          such additional information as the Bureau may require.
      ``(d) Limitations on Liability.--For purposes of section 909(a), 
  reimbursement need not be made to a consumer for a loss relating to a 
  spending card account that a financial institution establishes would 
  not have occurred but for the failure of the consumer to report any 
  unauthorized electronic fund transfer or account error--
              ``(1) not later than 60 days after the earlier of--
                      ``(A) the receipt by the consumer of a written 
                  account record under subsection (c)(1) that includes 
                  the unauthorized electronic fund transfer or account 
                  error; or
                      ``(B) the date on which account information that 
                  includes the unauthorized electronic fund transfer or 
                  account error is provided to or accessed by the 
                  consumer under subsection (c); or
              ``(2) in extenuating circumstances, such as extended travel 
          or hospitalization, within a longer time that is reasonable 
          under the circumstances.
      ``(e) Fees.--
              ``(1) Fees prohibited.--Except as provided in paragraph 
          (2), a financial institution may not charge in connection with 
          a spending card account--
                      ``(A) an annual fee;
                      ``(B) an overdraft fee, including a fee for 
                  shortage or nonsufficient funds, or any other fee for a 
                  transaction processed for amounts exceeding the account 
                  balance;
                      ``(C) a usage fee for use at the point of sale;
                      ``(D) a fee for a declined transaction;
                      ``(E) a fee for the use of an electronic terminal 
                  that is in the network of the issuer;
                      ``(F) an inactivity or dormancy fee;
                      ``(G) a fee for a balance inquiry or access to 
                  transaction information;
                      ``(H) a fee for an inquiry to customer service;
                      ``(I) a finance charge or other fee imposed in 
                  connection with an extension of credit;
                      ``(J) an account closing fee or a fee to obtain the 
                  remaining balance in the spending card account; or
                      ``(K) a fee for any activity not described in 
                  paragraph (2).
              ``(2) Fees permitted.--A financial institution may charge 
          in connection with a spending card account--
                      ``(A) a fee for a replacement card--
                              ``(i) of not more than $5 for the first 
                          replacement card requested by a consumer during 
                          any 12-month period; and
                              ``(ii) that is in addition to the 
                          replacement card described in clause (i);
                      ``(B) a fee for expedited delivery of a replacement 
                  card;
                      ``(C) a periodic fee, not more frequently than 
                  monthly;
                      ``(D) a reload fee, or any other fee for adding 
                  value to the spending card account, if the financial 
                  institution provides an alternate method for adding 
                  value to the spending card account without a fee;
                      ``(E) a fee for a transfer from the spending card 
                  account to another account;
                      ``(F) a fee for bill payment by check;
                      ``(G) a fee for a withdrawal by the consumer from 
                  an electronic terminal that is--
                              ``(i) located outside the United States;
                              ``(ii) not in the network of the financial 
                          institution, including a fee to cover the costs 
                          of any charge to the financial institution by 
                          the owner of the electronic terminal relating 
                          to the use of the electronic terminal by the 
                          consumer;
                      ``(H) a fee for a purchase or a withdrawal in a 
                  foreign currency; and
                      ``(I) an activation, initiation, or enrollment fee.
              ``(3) Disclosure of fee information.--
                      ``(A) Disclosure required.--Each financial 
                  institution that offers a spending card account shall 
                  provide to a consumer--
                              ``(i) together with any application, offer, 
                          or solicitation for a spending card account--
                                      ``(I) a table of any fees that may 
                                  be charged in connection with the 
                                  spending card account that--
                                              ``(aa) can be easily 
                                          understood by the consumer;
                                              ``(bb) is conspicuously 
                                          displayed to the consumer 
                                          before purchase; and
                                              ``(cc) includes, at a 
                                          minimum, the amount and a 
                                          description of each fee that 
                                          may be charged by the financial 
                                          institution under paragraph 
                                          (2); and
                                      ``(II) an estimate of the average 
                                  total monthly cost to a typical 
                                  consumer for using the spending card 
                                  account;
                              ``(ii) on the card or other means of 
                          access, a toll-free telephone number and 
                          website at which the consumer may access a 
                          clear and conspicuous disclosure of the fees 
                          that may be charged in connection with the 
                          spending card account; and
                              ``(iii) a wallet-sized summary of any fees 
                          that may be charged in connection with the 
                          spending card account and a toll-free telephone 
                          number for customer service relating to the 
                          spending card account.
                      ``(B) Regulations.--Not later than 9 months after 
                  the date of enactment of the Prepaid Card Consumer 
                  Protection Act of 2010, the Bureau shall establish, by 
                  regulation--
                              ``(i) the headings, content, and format of 
                          the fee table, estimate, and wallet-sized fee 
                          summary required under subparagraph (A); and
                              ``(ii) a profile of the typical consumer 
                          for purposes of subparagraph (A)(i)(II).''.
      (b) Technical and Conforming Amendments.--
              (1) Written periodic statements.--Section 906(c) of the 
          Electronic Fund Transfer Act (15 U.S.C. 1693d(c)) is amended, 
          in the first sentence of the matter preceding paragraph (1), by 
          striking ``A financial'' and inserting ``Except as provided in 
          section 923(c), a financial''.
              (2) Error resolution.--Section 908(a) of the Electronic 
          Fund Transfer Act (15 U.S.C. 1693f(a)) is amended by striking 
          ``or notification pursuant to section 906(b)'' and inserting 
          ``, notification pursuant to section 906(b), or written or 
          electronic documentation pursuant to section 923(c)''.
  
  SEC. 4. EFFECTIVE DATE.
  
      This Act, and the amendments made by this Act, shall take effect on 
  the date that is 6 months after the date of enactment of this Act.
target: Prepaid Card Consumer Protection Act of 2010 - Amends the Electronic Fund Transfer Act to extend its coverage to spending card accounts (prepaid cards) established by a consumer (or on a consumer's behalf): (1) to which recurring electronic fund transfers may be made, at the consumer's direction, and (2) from which payments may be made, at the consumer's direction, through the use of a card, code, or device. Treats as a spending card account any similar asset account operated or managed by a financial institution, or any other person, whose funds: (1) are pooled with the funds of a person other than the one who established the account, or (2) are held in a name other than that of the person who established the account.
  
  Excludes from the meaning of spending card account: (1) any nonreloadable general-use prepaid card in an amount under $250; and (2) any general-use prepaid card solely associated with a certain kind of health plan, a qualified transportation fringe, a health savings account or any other healthcare benefit account, a gift certificate, a store gift card, an electronic promise, plastic card, or payment code, or device, a nonreloadable card labeled as a gift card and marketed solely as such, or a nonreloadable loyalty, rebate, or promotional card.
  
  Requires a financial institution to offer electronic fund transfer services in connection with a spending card account only if the account is insured under the Federal Deposit Insurance Act and complies with its pass-through deposit insurance requirements.
  
  Requires any person that accepts funds in connection with an electronic fund transfer to a spending card account to: (1) transfer them, within 24 hours after accepting them, to an account at an insured depository institution; or (2) credit the spending card account an amount equal to the amount of such funds.
  
  Waives the requirement for providing a consumer with a periodic statement if a financial institution, among other things, provides the consumer with access to the account balance through a readily available telephone line and the Internet and at an electronic terminal or other device (ATM machine) that allows the consumer to make a balance inquiry. Prohibits the charging of fees for services required to meet these requirements, other than $1 for an optional periodic statement.
  
  Specifies other fees which may and may not be charged in connection with a spending account card.
feat_title: A bill to amend the Electronic Fund Transfer Act to provide protection for consumers who have prepaid cards, and for other purposes.