The Consumer Financial Protection Bureau (CFPB) has taken action against Global Tel Link Corporation (GTL) for taking millions from over half a million accounts and blocking money transfers for incarcerated people, who needed the money for essential items like food and medicine in prison.
“Global Tel Link took advantage of people who are incarcerated and their families, taking their money and preventing them from receiving money transfers needed to pay for basic necessities,” said CFPB Director Rohit Chopra.
“People in correctional facilities, along with their family and friends, often have no choice whether to use these products and are exploited by companies that abuse their monopoly power to boost their own profits,” he said.
The CFPB is ordering GTL to stop these practices, repay $2 million to affected people, and pay a $1 million fine.
GTL, which provides services like money transfers for people in correctional facilities, often blocked accounts when a chargeback was filed, even if the incarcerated person wasn’t responsible. The company also took money from inactive accounts without proper notice and hid certain transfer fees from consumers.
The CFPB’s order requires GTL to repay affected consumers, stop blocking accounts, stop taking funds from inactive accounts, and be transparent about all fees.
About GTL
GTL is a Virginia-based corporation doing business as ViaPath Technologies. Its wholly owned subsidiaries include limited liability companies Telmate, LLC, based in California, and TouchPay Holdings, LLC, based in Texas.
The companies contract with correctional facilities across the United States to provide various products and services, including money transfer services, to incarcerated people and their family and friends.
Friends and family use the services to deposit money into an incarcerated person’s account, and these funds may then be used to pay for items in the correctional facility’s commissary. GTL and Telmate also provide accounts to pay for telephone services, online messaging, and video visitation.
GTL is often the sole provider of money transfer services in the correctional facilities where it operates.
It has a “no-refund” policy for money transfers, with limited exceptions, which makes it difficult for friends and family to resolve errors such as duplicate transactions or funds sent to the wrong type of account.
As a result, these consumers may file chargebacks with their own financial institutions to try to recover their funds. In some cases, GTL’s own customer service representatives instruct consumers to file chargebacks. In response, GTL in many cases blocks the account of the person who is incarcerated from receiving additional transfers via credit card or debit card until someone repays the amount of the chargeback and, in some cases in the past, an additional fee.