WASHINGTON, D.C. — The Consumer Financial Protection Bureau (CFPB) has taken decisive action against Global Tel Link Corporation (GTL), accusing the company of engaging in illegal practices that deprived incarcerated individuals and their families of millions of dollars. The CFPB’s enforcement order mandates that GTL and its subsidiaries halt these unlawful activities, reimburse affected consumers at least $2 million, and pay a $1 million penalty to the CFPB’s victims relief fund.
CFPB Director Rohit Chopra condemned the exploitation by stating, “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.” Chopra emphasized the vulnerability of this demographic, who often have no choice but to rely on such monopolistic services.
GTL, operating under the alias ViaPath Technologies, along with its subsidiaries Telmate, LLC, and TouchPay Holdings, LLC, provides money transfer and communication services to correctional facilities across the United States. These services allow friends and families to deposit funds into accounts for incarcerated individuals, which are essential for purchasing items like food, medicine, and clothing.
The CFPB’s investigation revealed several violations by GTL:
- Blocking Money Transfers: GTL employed a “no-refund” policy that often left consumers unable to resolve errors such as duplicate transactions. As a result, many filed chargebacks with their financial institutions. GTL then blocked the accounts of incarcerated individuals from receiving further transfers until the chargeback amount, and sometimes an additional fee, was repaid. This policy persisted despite the incarcerated individuals having no control over the chargeback filings.
- Seizing Inactive Account Funds: Between 2019 and 2023, GTL and Telmate systematically drained funds from accounts that had been inactive for 90 to 180 days, without adequately notifying account holders. This practice affected approximately 575,000 accounts, effectively converting consumers’ funds into corporate profit without proper disclosure.
- Hiding Fee Schedules: GTL failed to provide transparent fee schedules for money transfers, leaving consumers uninformed about the costs associated with different deposit methods and channels.
The CFPB’s enforcement action orders GTL to:
- Compensate affected consumers by returning all unjustly charged fees and chargeback amounts, as well as funds seized from inactive accounts.
- Pay a $1 million civil penalty to the CFPB’s victims relief fund.
- Cease account blocking due to chargebacks, stop further fund seizures from inactive accounts, and ensure full disclosure of money transfer fees.
The CFPB’s action not only seeks justice for the half-million impacted accounts but also sends a strong message against the exploitation of some of the most marginalized members of society.
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