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Crackdown on MetaBank Casts a Shadow on NetSpend’s IPO

Crackdown on MetaBank Casts a Shadow on NetSpend’s IPO

Federal banking regulators this thirty days cracked down on MetaBank, a significant card that is prepaid, an action that tossed into concern the pending initial public providing of prepaid credit card system supervisor NetSpend Corp.

Austin, Texas-based NetSpend is scheduled to cost its long-planned IPO on Thursday, based on reports in the economic cables. But its close ties to MetaBank caused rounds of conjecture about if the IPO will in truth take place. A NetSpend representative says he can’t comment.

On Tuesday, MetaBank’s moms and dad business, Storm Lake, Iowa-based Meta Financial Group Inc., reported into the Securities and Exchange Commission that any office of Thrift Supervision had taken enforcement actions against MetaBank. The OTS banned MetaBank from issuing any brand new loans under its iAdvance item as of Wednesday, and in addition it put settings on its company of issuing loans prior to clients’ receipt of income tax refunds, alleged anticipation that is tax-refund.

“The OTS recommended us on Oct. 6 so it has determined that the lender involved in unfair or acts that are deceptive methods in breach of the Federal Trade Commission Act and OTS advertising laws regarding the the bank’s operation associated with the iAdvance system and needed the financial https://paydayloanmaryland.net institution to discontinue all iAdvance line-of-credit origination activity by Oct. 13, 2010,” Meta Financial’s filing claims.