New California State Law Will Address $19+ Million in ATM Fees Charged to CalWORKs Recipients
LAW WILL EQUIP CALIFORNIANS TO AVOID COSTLY ATM FEES
Sacramento: September 30, 2014: Earlier this week, Governor Jerry Brown signed AB 1614, the EBT Protection and Empowerment Act, a bill sponsored by Assemblymember Mark Stone (D-Monterey Bay). The bill requires that CalWORKs recipients receive critical information to help prevent ATM fees being charged to them when accessing their benefits. A report released earlier this year by the California Reinvestment Coalition found that $19.4 million in ATM fees were paid in 20012 by people in order to withdraw their CalWORKs and other public assistance benefits.
“This measure will help parents better provide basic necessities for their kids instead of using part of their needed benefits to pay for bank and ATM fees,” said Assemblymember Stone. “I’m pleased that the Governor has taken this step to fight multigenerational poverty.”
Andrea Luquetta, policy advocate with the California Reinvestment Coalition, explained: “Every year, millions in CalWORKs benefits meant to help families are instead lining the profits of banks that charge recipients to use their ATMs. This bill is the first step to addressing that problem by equipping people with information about safer, less expensive alternatives like direct deposit of their benefits. We’re also happy to see that some banks have committed to not charging these ATM fees to CalWORKs recipients- and we hope other banks will also stop charging these fees.”
AB 1614 directs county CalWORKs administrators to inform recipients about all of their options for receiving their benefits, including direct deposit. The new law also locks in current best practices for future contracts for vendors who administer the Electronic Benefits Transfer (EBT) systems, including the provision of a toll-free number and online dashboard for consumers to track their card use and to report theft. AB 1614 addresses problems for retailers and consumers created by recent outages in the Electronic Benefits Transfer (EBT)system. Under the new law, all future EBT vendors will be required to alert recipients and retailers if an EBT outage is expected to last for more than an hour.
“California has one of the best systems for delivering benefits to grant recipients, improvements made by AB1614 will simply increase the ability of our state’s poorest consumers to make choices and prioritize their resources for their basic needs,” said Jessica Bartholow, a legislative advocate for the Western Center on Lawand Poverty.
The $19.4 Million ATM Fee, a report released in March 2014, analyzes the high toll that ATM fees take on California’s most vulnerable families. The report found that big banks earned millions of dollars from the fees,including Bank of America ($3.6 million); JP Morgan Chase ($2.8 million); and Wells Fargo ($2.3 million). To read the report, click here: The $19 Million ATM Fee.