Payout Platform Tremendous Misrepresents the Value of Its Virtual Prepaid Cards, Class Action Alleges

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A proposed class action alleges Tremendous LLC has mispresented that its digital prepaid cards function like traditional gift cards, given that they are generally unusable at physical stores and consumers are prevented from depleting the full value of a card’s preloaded funds.

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According to the 16-page complaint, Tremendous is a company that helps businesses send payouts to customers. For instance, when those covered by a class action settlement choose to collect their payment in the form of a prepaid Mastercard, consumers may receive their virtual cards from Tremendous, the case says.

Although the defendant represents that the Mastercard option will allow a consumer to access their funds through the “most widely accepted prepaid card,” most retail stores do not accept the digital cards because they cannot be physically swiped, the lawsuit contends. Instead, the card’s account number must be punched at the register, the filing shares.

The plaintiff, a New Jersey resident who received $28.34 from a class action settlement in 2022, says that Walmart, McDonald’s and a local store all refused to accept his Tremendous card.

The lawsuit points out that cardholders who use their typically “modest” class action settlement payments to shop online must pay “comparatively exorbitant” shipping and handling fees. This renders the actual usable amount on the card lower than the amount stated, the complaint alleges.

By way of example, the case presents a hypothetical scenario in which a woman must buy a $2.41 ruler online because brick-and-mortar stores will not accept her $12 Tremendous card: 

The complaint goes on to say that the woman will be unable to use the remaining $1.83 in her account since the amount is not enough to pay shipping and handling charges, and Tremendous does not allow cardholders to supplement the cost of an order with a different card.

In addition, “[the defendant] does not reimburse cardholders on the remaining balance,” the suit contends. “In other words, the card is on a ‘use it or lose it’ basis.” What’s more, Tremendous charges cardholders a $3.95 dormancy fee after only 13 months, the case shares.

As a result, “[t]his remaining balance operates as a hidden fee undisclosed to the cardholders,” the lawsuit argues.

The plaintiff claims that he and other consumers would not have selected Tremendous cards as their payment option had they known they would be unable to take full advantage of the funds they were promised or spend their payments at retail stores.

The lawsuit looks to represent anyone in New Jersey who obtained a Tremendous card during the applicable statute of limitations period.

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