The financial industry is putting their efforts to combat an escalation in tax fraud. But just recently, its actions are keeping thousands of legitimate filers from accessing their tax refund.
According to ABC NEWS, it is preventing a lot of people from their money and delaying access to their much-anticipated tax refunds. Also, those people who rely more on prepaid debit cards are allegedly considered as poorer Americans who cannot have traditional bank accounts.
One prepaid card user, named Shannon King, had even had her money frozen for two weeks. She had planned to use the tax refund for car repairs and to help her pay for a move. But both of her plans were delayed as of the moment. King stated, "It was very frustrating."
She owns a Wal-Mart MoneyCard, which is operated by Green Dot. Unfortunately, after her refund was deposited, Green Dot kept her from accessing her account. She was even asked to send a picture of her Tennessee state identification card to verify her account.
The process to access the money took over two weeks. She had to submit photos of her ID for a couple of times since Green Dot said they were not comprehensible. She insisted that she spent hours on the phone just to resolve the problem with the customer service agents for the company.
However, prepaid debit card companies like Green Dot and NetSpend claimed that the problems occurring with accessing the accounts are the outcome of tighter fraud protection process. "We're working with the company to ensure that any customer service issues are resolved as quickly as possible," a spokeswoman for Wal-Mart said via Yahoo! News.
The prepaid debit card companies, along with the IRS, are still trying to find ways to stop the problem of tax fraud caused by identity thieves. Criminals file bogus tax returns using other people's identity. They would claim a refund and collect the money. Numerous people don't really have any idea that they fall with this trap until they try to file a legitimate return and are unable to access it.
Telegram noted that Green Dot approximates 9,000 clients have their accounts frozen this year. Moreover, NetSpend said that they have been blocking accounts, but refused to give an exact number of affected users. American Express also stated that it has been doing its best to raise their fraud protection methods.
Meanwhile, the IRS and other agencies are claiming that they are doing their best to combat and resolve the problem. But as a result, it is still expected that due to the intensified efforts to fight tax fraud, banks and other prepaid debit card companies are tightening their protection processes.
