HARTFORD, Conn. (Legal Newsline) - Connecticut Attorney General Richard Blumenthal has applauded an announcement by the Kardashians that they have severed ties with the Kardashian Kard prepaid debit card.
Blumenthal received word from legal counsel for the Kardashian sisters, stars of the reality TV world, that they are seeking to immediately end their association with the Kardashian Kard, in part because of the concerns Blumenthal brought to their attention.
"I am cautiously pleased that the Kardashians are terminating ties to the Kardashian Kard - a prepaid debit card loaded with predatory fees," Blumenthal said.
"A larger lesson - common to other prepaid debit cards - is that targeting young adults with predatory card terms and conditions may bear close scrutiny and caution."
The card, named for the reality show celebrity sisters Kourtney, Kim and Khloe Kardashian, is described as a prepaid MasterCard debit card, requiring consumers, Blumenthal says, to pay in advance for card credit, along with significant "activation" and "monthly" fees.
Over the weekend, Blumenthal sent a letter to University National Bank, which issues the Kardashian Kard in an agreement with MasterCard, demanding specific details about the card terms and fees and how it was being promoted and sold in Connecticut.
Blumenthal was concerned due to the card's fees combined with its appeal to financially unsophisticated young adults.
The card is filled with fees and charges, including a $99.95 annual fee, a $7.95 monthly fees after the first year, and fees for ATM withdrawals, loading and even talking with a live operator, Blumenthal says.
"Keeping up with the Kardashians is impossible with this card, where consumers lose money before they use money. Even before consumers spend a dime, the Kardashian Kard fees swallow the card's value," Blumenthal said.
"The Kardashians perhaps recognize that fans will be fuming over these money-eating cards. My office remains concerned until University National Bank and MasterCard officially agree to stop selling these cards - with or without the Kardashian name."
Blumenthal believes the "prepaid debit cards" could be subject to the state gift card law, as they resemble gift cards. This law is designed to protect consumers from pernicious and predatory fees that can unconscionably drain value.
The Kardashians and their company, Dash Dolls, had an agreement with The Revenue Resource Group LLC, granting a limited license to use their names, photographs, likenesses and endorsements in connection with "the marketing and sale of MasterCard prepaid debit cards in the name of the Kardashians."
Dash Dolls terminated the agreement "effective immediately" in a letter sent to RRG and University National Bank.