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N.J.-based school lunch payment company rips off parents with ‘junk fees,’ lawsuit says

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PayPAMS and other companies like it hit parents with unfair ‘convenience’ and ‘service’ fees, according to the federal lawsuit.

A New Jersey-based company that processes payments for public school lunch programs is unfairly charging parents as much as $100 million in unnecessary “

But according to the complaint, which was filed Wednesday, PayPAMS and other companies like it “take lunch money away from kids, and particularly low-income kids, by charging ‘convenience’ and ‘service’ fees at the school lunch counter.” Those fees can divert up to $0.60 to payment processors for every $1 spent by low-income families on school lunches, according to the Consumer Financial Protection Bureau.

The complaint was filed in the U.S. District Court for the District of New Jersey by a coalition of consumer advocacy attorneys, who are accusing the company of running afoul of state consumer fraud laws.

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