So are Pre-paid Visas not considered bank accounts?

[tinfoilhat]

Where does the money come from that goes to the prepaid account?
It comes from your paycheck, credit card, bank account, debit card. It comes from a source that would otherwise end up in your bank account, an asset you purchased, or cash on hand (which is asked by trustees)
How is this any different than just taking cash from one of these sources and just keeping it at home?
I've been shot down a few times for advocating fraudulent ideas, so right now I'm shooting back.

[treehugger1]

Well, if there is money available on it when you file or when you meet the trustee, then it represents a cash asset. I'm not an attorney, but if you withdraw all the money from the card before filing and have nothing available on it at the time the question is asked, it would seem to me the answer is, "No, I have stated all my assets as indicated on the appropriate forms." I don't see anything fraudulent about this. Now, if you had a few hundred dollars in money orders or a few hundred dollars available on a prepaid card (assets,) then you would need to include such assets if the question were asked. Other than that, the value of a pre-paid debit card appears only to be the amount you have available on it. There are banks that are connected to yoru prepaid debit card, but just ry calling th ebank and see if they even know your name, or have your social security number. My guess is they do not. I think they only have your 16 digit account number tied to some large account that the issuer (Netspend, accontnow, western union, etc) keeps on deposit to cover all the cards they serve. How do I know this? Well, I don't know with certainty, but I do know that the bank that holds funds related to one of my prepaid debit cards is not even licensed to conduct financial business in my state. The card issuer might be licensed (I doubt it,) but the bank is not.

I would also guess that prepaid debit cards are tied to the entire issue of "commercial paper." I won't go into any details about how commercial paper works, but it is bought, traded, and sold on a daily basis. Without the value of commercial paper, our daily financial ability to do business as a region/country would collapse. While it may seem strange, I think a lot of money is made on the daily amounts of unspent balances on pre-paid debit, gift, etc, cards. I think banks love to have the connection to cash assets that pre-paid cards represent. Again, I'm not sure how all this works in reality, but there is some reason that the issuers go out of their way to state the card does not represent a bank account.

So my opinion is that you don't want to have money on your prepaid card when you file, or perhaps the day of your 341 meeting, anymore than you don't want to have a stack of savings bonds, money orders, etc in your pocket.

If you have a direct deposit tied to your prepaid card, then clearly this is traceable through a subpoena served on your employer. Your employer account would show a routing number and account number. These numbers for prepaid accounts are only intended to serve as the "deposit accounts," but under scrutiny I suspect someone could find the account. This takes time and money.

I wish I had an answer for you, but as mentioned, I have prepaid accounts that imply a connection to a regional bank, but I suspect that any of these banks know who "treehugger" is. The banks probably don't even have a address or SSN for Treehugger." They don't care to know th edetails. They do care about the overall daily balance that the entire package from the card issuer represents at the end of a bussiness day.

As always, just guessing, and if I were before a trustee with a zero balance on a prepaid debit card, I would not inlcude this as an asset, or even cash on hand.

[DeadManCrawling]

I am with BigBoy on this. I do not have any pre-paids, as I had not really thought much about such things, but now I am going to get some.

To me it makes total sense.

The old adage "knowledge is power" applies both ways and if you can keep creditors from knowing what form your funds are in and how you use them, I think that is an excellent idea. I plan to apply this idea before, during, and after BK. The one caveat I will use is that in the runup to and process of BK the balances will be so low that they are exempt or totally empty, just to avoid any legal or ethical quandaries.

[azguy]

BigBoy-
That's EXACTLY what I've been doing. I use my card for things I don't want documented- sounds bad, but it's really not. Not buying/selling anything illegal- but it also helps with normalizing spending. When we go over limit at our bank, the bank grants the charge- but then hits us with a $35 overdraft fee. I've paid over $700 to BoA once because THEY reversed and held a deposit I made earlier (thus, my $0.59 taco from Taco Bell cost me $35.59, as well as 19 other charges immediately after). On a pre-paid- if there's no more money in the account, no charges go through, and no more overdraft fees. Works great with a wife... ;)

So, essentially, don't lie to the BK Court about it- but if you have nothing on it when you file, there's nothing to lie about anyways. However, there's no way they can easily trace it to you, either. I DO remember giving GreenDot my SSN when I signed up tho...

Maybe I should go get a different kind of card. Hmmm...
Thanks!

[Trixie007]

Never mind lol.

[LuciluS]

I use the WalMary Money Card, only because WalMart is near me. But in the first card I got I filed it out completely and accurately. After some thought i bought another one for $3 and then Used my Initials on the application so it looks like this J R Smith I then used a birthday I can remember 01/01/year I was born, they ask for a SS number unless you are from outside the country, I checked that box. It then asks for a drivers license number but it accepts no numbers or symbols like * so I just put JRSMITH ...LOL... and my state. I then used my real PO Box number and a new yahoo email address that is only for this card. So its still me, my initials at my real PO Box, so I messed up on the birthday and got confused over the SS part <shrug>.... I was really expecting a letter saying they could not process the application, but a week later my new card showed.

My point is I don't want to go do something that is so blatantly wrong such as saying I am JR Smith that fraud could be implied. But then I was on medication when I filled it out and .....oops I make a mistake and didn't even realize it, remember intent is the key to all fraud... But on the other hand if i did say I was J R Smith and lied about all the other info, unless I did do something else illegal no one would know and no hard would come, same as the prepaid cell phone I bought, it is under another name is it wrong or illegal, I don't know, I don't really care so long as I don't use my phone for anything illegal. I only did that with my phone since I don't want anyone but those I give the number to have that number. Its not as if I am committing ID theft.

Okay, I think I understand the usage of these Cards. Not advantagous if you intend to file BK in the next 90 - 120 days. The Cards come in handy, when one is attempting to lower their Cash Assets, as Credit Card Cos., CA & JDB's may attempt an 'Asset Report'. Other Factor is your average checking account is Low - Another Plus for the Debitor. And transactions on these Prepaid Credit Cards are NOT Traceable. Right????

BigBoy2U -

Just don't forget to log into Yahoo every 30 days or your account will be closed.

Also, I guess if one should ask to see your DL#, because the card holds only your initials; whereas the DL# lists your full name, you've never had a problem using the card as a charge let's just say at Wallyworld?

Luci

PS BigBoy, fully understand 'under medication' as I take Morphine 3 X a Day along with various other meds. In fact, I'm worried about our 341 hearing. Long drive to Courthouse. Parking Garage is a block away & 4-6 stories high. I will be using my scooter that day as I'm unable to walk that far.

What worries me, is I'm afraid to take my morphine in the morning as BK cases are scheduled from 9 am - Noon. So, if I don't take it, Severe pain sets in and I sweat, get edgy & my hands shake & blood Pressure spikes. I left Mon. at 9 am to go visit my father. Was there for 2 hrs & PM appt. was at 1pm. No meds & blood pressure was 162/120 because of severe nerve pain.

If I take it and Trustee ask a different question than the cheat sheets I've seen, thus far, I'm afraid I will not understand the question & answer could be slurred. Don't tell me to let Dh do the talking as this BK is Greek to him. He is an OTR Truck Driver & is only home 1 day a week.

[optimistic1]

Sheesh, I made one little post about keeping your money at home in a safe instead letting a creditor garnish your savings account and was slammed by a moderator. This whole thread is just nothing but promotion of fraud, yet I have not seen one post by a moderator.

[LuciluS]

Sheesh, I made one little post about keeping your money at home in a safe instead letting a creditor garnish your savings account and was slammed by a moderator. This whole thread is just nothing but promotion of fraud, yet I have not seen one post by a moderator.

Optimistic:

I remember that post and didn't agree with the Mod. on that post or this Thread. I don't think this thread is about Fraud. It's just like planning a BK where your wages for the previous 6 mths. are below your State's Median Income.

This thread is planning so a Creditor is unable to grab your Cash Assets whenever one wants to do so. That's called Planning.

I don't think it will be too long before these PrePaid CCs will be easily traceable which I will not Like. But let's face it, when you try to circumvent the Laws, some Dang Senator or Congressmen will get a Bill passed to make sure pre-paid Visas are traceable or something to that effect.

I've read where some of these Pre-Paid Visa are appearing on Credit Reports. Thus it depends on the Issuer of the Visa to report to the Credit Bureaus.

Luci

[optimistic1]

Bigboy, I respectfully disagree with you, while your specific posts do not advocate the idea, and your opinion is not advocating such things, others in the thread have done just that, which is what I stated in my post, this has nothing to do with your posts. So lets agree that I misstated my sentence, and should have said, "parts of this thread are just promoting fraud". Happy now?

Anyone with a shred of intelligence can put 2 and 2 together on this one, you have got to be kidding me bro. When I made a post about storing savings at home in a safe, I never even used the word "court" or "trustee", it was a post in the collection forum concerning garnishments. While for whatever reason people choose to use these prepaid cards, you can bet that people will get or give ideas, just like the three posts explicitly state below. I dont know how much more specific you need me to be, just read through all the posts on the thread, some dont imply anything, others absolutely do.

I guess if they (court) ask about bank account..according to their Terms and Conditions you don't!

So how would the BK Trustee even know about it, let alone prove you had it?

I found a couple that are reloadable to $2500.00 simply by swiping the card. Your NAME isn't even associated with them. In addition, it appears the "holder" is insured under the FDIC. Hell, you could buy 100 of them and no one would ever know the difference. You don't fill out any paperwork, nothing, nada, zip. You purchase the card for a one time payment ($5 - $9) and then can reload it anywhere on the visa interlink system. Since they are in the VISA/MC system, one can use them for paying bills just as one would use any debit/credit card. How on earth would anyone ever discover if one had one of these cards?

I'm not advocating fraud or dishonesty. Don't get me wrong. But, I do believe these financial devices are available because there is a need. $2500 seems like an awful lot to put on a "gift" card that is not traceable and no consumer name attached to it.

As you can see, people are implying about utilizing the cards to store cash on, and implying that the trustee would not ever even know about it, which is totally a different ball of wax. The last time I checked, thats called fraud. Do you have some other name for it BigBoy? Of course that is a rhetorical question. I do see the prepaid cards as a means of not having your bank account garnished by some slum creditor, but then posts quickly turned from that, to talking about how the "trustee would never even know about it", etc.etc.

Case closed.


BTW.

Treehugger, sorry I dont mean to use your post as an example, I know you mean well and dont advocate fraud, but Bigboy wanted some examples or specifics of how people could interpret the posts.

[azguy]

BigBoy-
That's a great point. I agree, lying under oath is not a good idea. Not sure how they would ever KNOW about it- but, morally, it's not a good idea anyways.

Creditor exams- are those rare? Is that only when a creditor wants to challenge your financial affairs, as they think you may have more than you state in your case?

Lastly- does it ever happen to where the court can get a Warrant to search your property to document all the items you may have in your home? Does that ever happen?

[bk2009]

I was given two pre-paid visa cards as gifts last year, both times I had to activate them. To activate them online required giving my name.

[blankslate]

I listed my pre-paid re loadable Visa as "cash on hand" of course I only had $3 on it. I also printed out the statement from the card and submitted it with the other documents to the Trustee. I think they are treated as cash rather than bank accounts.

[GoingDown]

Here is pretty much what all of them state:

"The Card: The Card is a prepaid card. The Card allows you to access funds you place on the Card. The Card does not constitute a checking, savings or other bank account and is not connected in any way to any other account you may have. The Card is not a credit card. You will not receive any interest on your funds on the Card."

It seems pretty clear to any least-sophisticated consumer that the card is a card. It clearly states it is not a checking, savings or other bank account. In fact once you apply for any of these cards, you are acknowledging you have read and agree to the terms and conditions.

So, should the question come up, "Do you have a checking, savings, or bank account, one could answer no." I mean you already agreed that what you might have does not constitute any of the three. Since the more-sophisticated consumer might think the card is somehow related to a bank account, he/she already agreed that they understand it does not. It is strange, I know. I wonder why most of the prepaid cards all have this disclaimer.

There are a lot of other questions that come to mind. One could be asked to produce all statements over the past 6 months. Many folks opt not to get statments from their prepaid accounts (usually costs a lot more for paper statements, nor do they create a login to the card's website account info. You can't produce a statement you don't have.

I'm just playing the devil's advocate here. How does one answer a query related to documents for prepaid accounts? The disclaimer to the consumer is not there without reason. Perhaps, the bank holding the funds that the card accesses does not want any contractual tie to the consumer. There are millions of people who don't have or can't get regular checking accounts due to all kinds of reasons (CHEXSYSTEMS bein one of them.) Other folks prefer to simply live an alternative lifestyle.

Debtor exams are extremely rare, but if I was ever called in for one, there is no way in He** that I would ever give them my pre-paid VISA card information, and you have to remember that the creditors only know what you tell them for the most part. If you don't tell them about it, they will probably never find out about it.


From the personal experience of a friend who had a judgment against her, and who had a pre-paid VISA card with a certain bank, even after the creditor sent out garnishment orders to all of the local banks in her area (including the bank that offered the pre-paid VISA card to her), her money was safe and still is safe. That bank did not seize the money in her pre-paid card. She is still using that same card and it still works. That bank obviously did not see that card as an account subject to garnishment court order papers served by a Maricopa County sheriff's constable.

So, yes, I think they are safe from creditors. But I sure wouldn't tell them about it.

[GoingDown]

This is the whole point. I mean lets be frank here. You can put on your BK filing anything you want, you can tell the trustee anything you want, you can tell a district court or superior court judge anything you want, you can say what ever you like in a deposition. Will anyone know you are lying? Most people that lie no one knows until your caught. But, if I know I have money that I am intentionally hiding from any of the above and I commit fraud or perjury, this is why the penalty for even small amounts can be so stiff. Look you can go rob banks all day long and its not a problem until you get caught. This is no different. Here is what is so stupid about this though. First the typical Joe that goes in and lies about not having any assets and then has <$10,000 stuffed in a mattress is risking a huge penalty and jail time of around 1-3 years over <$10K. He thinks no one will know and I am sure this happens a lot. I have read many BK fraud cases just like this (matter of fact I would suggest anyone thinking about it google it and when you see how little money people lied over and the penalty they got, I don't think you would still do it) I mean I read a case of a guy local to me to was almost 80 years old who got 5 years in prison for hiding assets and his wife who was 76 got 2 years. Now you read the case and think what an idiot. But Federal Prosecutor had no problem putting an 80+ year old man away for 5 years since he lied about owning a house and some property that he sold to his Mexican farm worker and then "bought" it back only a couple months after his BK was closed. For someone with no assets how did he come up with the money to buy the house back only a couple months after BK? Must have been that lumpy mattress? Yes it was, busted!




It is rare mostly since it costs the plaintiff money to conduct and if you have nothing they wasted the money. Also if you owe small amounts <$10K it is generally not worth the time or money to conduct one. Also, they are really only done if the plaintiff has reason to believe you have assets they don't know about. Example: you owe ABC credit card, they sue you get a default judgment. They then manage to serve you for a debtors exam. They reviewed your credit card statements and see you travel to another state and made a lot of charges to a vacation lake resort, you charged a lot of fuel, some repairs at a marina, slip rental. So in the debtors exam they ask what assets you own, they find you own a 40' houseboat that is paid off and worth $200K. Without the debtors exam they would not have known about the asset. More typical (I did this when I sued this lady) grandma we knew had around $200K in cash from the sale of a house. But you have no idea where she had the money put. I sued her and won a $45K judgment against her. But since I don't have a bank account number or know where the money is at I HAVE to conduct a debtors exam to find it if she doesn't pay the judgment. In my case she paid only hours before we were going to serve here with notice of the debtors exam. Had she failed to pay me she would have been served and then you simply ask where is the money, what bank, what account number. Then have the judge issue an order to allow me to seize the money from her bank. That is how it works, but you really have to have an idea they have something before you waste your money on a fishing expedition. In my case I did the leg work, found she sold her old house, it was paid off, I pulled the records of the sale and we calculated she had over $200K. So we (me and my attorney) knew grandma was flush with cash. But she kept telling her attorney and us during the depositions she was on a fixed income and had no assets (we knew better). We never let her know we knew about the money she has all during the depositions. Once we won and I got a judgment we demanded payment. Her attorney wrote saying; look she is on a fixed income and has nothing, best you can do is lien on her new house. Well we knew grandma didn't pay down the new house she bought and had $200K+ floating around. So we send a demand. Then a couple days before we were going to serve her and 30 days past the date for her to pay me, we sent her and her attorney an accounting of the sale of her old house and the fact we knew she had cash. Her attorney called mine, was very apologetic, explained he didn't know she failed to tell him (see he can't be part of any fraud) and that same day we got a FedEx letter stating they money would be send via certified funds by the end of the next week, and it was. But you can often tell who is hiding stuff when things don't add up.




Well its not a warrant, but if I sue you and win I can then post a bond to have the sheriff come out and inventory your items and then seize items that are non-exempt. Now this is highly state dependent. Remember you have exemptions in most states and it is UP TO YOU TO EXERCISE YOUR EXEMPTIONS AND STATE WHAT IS EXEMPT!!! A somewhat typical scenario for this would be, I sue you and win a judgment for a defaulted credit card. You have recently charged up thousands of dollars of TV's, stereos, computers (now this is not the same as a security interest in those items that is different) but I have a good reason to believe you have a lot of stuff that is NOT exempt so we go looking for it. And one last example, ex-wives, unknowing family member and neighbors are your best source for screwing you. Say a creditor pokes around and talks to your ex-wife you screwed over. She says, "That SOB has this huge Rolex collection must be worth $50K." So I am now down at the court getting a judge to order the seizure of the property and I get to look around for other non-exempt items or take enough to cover what is owed to me.


Look bottom line is this, if you really don't have much nothing is going to happen and you don't need to lie. If you really do have assets and cash and want to lie about it then you may end up paying the price. Nothing says you can't get creative within the laws of being exempt. But once you are over the exemptions you run the risk of losing those items or money.

Again if anyone else has anything to add or correct what I have said please chime in. A lot of what I talk about is from personal experience an is based on my states laws.

Yes, that varies widely from state to state. In Arizona, "the sheriff's constable has no right of entry into a debtor's home" for a civil judgment. The document from the local government goes on to state that unless you know exactly what the debtor has and where it is located, the constable will probably not be able to do you much good to collect the judgment owed to you. You simply don't answer the door when the constable arrives on the scene, and there is not much they can do. I sure wouldn't tell them anything.

[GoingDown]

Bigboy, I respectfully disagree with you, while your specific posts do not advocate the idea, and your opinion is not advocating such things, others in the thread have done just that, which is what I stated in my post, this has nothing to do with your posts. So lets agree that I misstated my sentence, and should have said, "parts of this thread are just promoting fraud". Happy now?

Anyone with a shred of intelligence can put 2 and 2 together on this one, you have got to be kidding me bro. When I made a post about storing savings at home in a safe, I never even used the word "court" or "trustee", it was a post in the collection forum concerning garnishments. While for whatever reason people choose to use these prepaid cards, you can bet that people will get or give ideas, just like the three posts explicitly state below. I dont know how much more specific you need me to be, just read through all the posts on the thread, some dont imply anything, others absolutely do.








As you can see, people are implying about utilizing the cards to store cash on, and implying that the trustee would not ever even know about it, which is totally a different ball of wax. The last time I checked, thats called fraud. Do you have some other name for it BigBoy? Of course that is a rhetorical question. I do see the prepaid cards as a means of not having your bank account garnished by some slum creditor, but then posts quickly turned from that, to talking about how the "trustee would never even know about it", etc.etc.

Case closed.


BTW.

Treehugger, sorry I dont mean to use your post as an example, I know you mean well and dont advocate fraud, but Bigboy wanted some examples or specifics of how people could interpret the posts.

Do you honestly think the trustee is going to waste his or her time trying to track down a pre-paid VISA card? I am confident they would NEVER find out unless you tell them. So, you are not going to get in trouble for this kind of "white" fraud (like white lies).