They should not be keeping the money unless you caused them a loss (which it does not sound like you did) or you showed up on an OFAC list. If you are a positive match to the OFAC list, they can, and have to, keep the money.
Those are the only reasons I can think of that they could legally keep the cash.
You probably agreed to arbitration on the account, so suing them could be fruitless and end up costing you money. I would review yout terms and conditions for the card to see how to initiate the arbitration process. https://www.americanexpress.com/us/content/prepaid/american-express-prepaid-card/cardmember-agreemen...
Suspension or Cancellation of Your Card/Refund
"We reserve the right to suspend or cancel your Card if (i) you neither load funds to nor use your Card for a period of one year or more, (ii) if you attempted loads to your Card from your Funding Source and are declined or dishonored repeatedly (iii) if you violate these Terms and Conditions, (iv) if you fail to pay any Fee within sixty (60) days after the date it is due, (v) if there are potential fraud or security risks associated with your Card, as determined by us, (vi) if you withdraw your consent to deal with us electronically pursuant to the Consent Statement, or (v) for any reason allowed by law. We may, in our sole discretion, decide not to exercise our right to suspend or cancel your Card upon the occurrence of an event described in the preceding sentence; but forbearing from exercising our right to suspend or cancel your Card (either once or repeatedly) will not constitute a waiver of or preclude the exercise of our right to do so in the future upon the occurrence of an event described in the preceding sentence. If we cancel your Card after the Valid Thru date has passed, any Available Funds remaining on the Card upon such cancellation, after payment for any applicable Fees and/or other amounts payable to us, will be returned to you by crediting your Funding Source or issuing you a check or some other means. If we cancel your Card prior to the passing of the Valid Thru date on the Card, we may condition reimbursement upon return of the Card to us. The Card is our property. If we suspend your Card, you will not be able to use your Card for purchases or ATM access and you may not have access to certain services associated with the Card such as Purchase Protection3 or special offers as referenced in this Card Member Agreement. While your Card is suspended, we will not collect any Fees with respect to your Card."
Initiation of Arbitration Proceeding/Selection of Administrator:
Any Claim shall be resolved, upon the election by you or us, by arbitration pursuant to this Arbitration Provision and the code of procedures of the national arbitration organization to which the Claim is referred in effect at the time the Claim is filed (the “Code”), except to the extent the Code conflicts with this Agreement. Claims shall be referred to either JAMS (“JAMS”) or the American Arbitration Association (“AAA”), as selected by the party electing to use arbitration. If a selection by us of either of these organizations is unacceptable to you, you shall have the right within 30 days after you receive notice of our election to select the other organization listed to serve as arbitration administrator. For a copy of the procedures, to file a Claim or for other information about these organizations, contact (1) JAMS at 1920 Main Street, Suite 300, Irvine, CA 92614; www.jamsadr.com, (2) AAA at 335 Madison Avenue, New York, NY 10017, www.adr.org. In addition to the arbitration organizations listed above, Claims may be referred to any other arbitration organization that is mutually agreed upon in writing by you and us, or to an arbitration organization or arbitrator(s) appointed pursuant to section 5 of the Federal Arbitration Act, 9 U.S.C. sections 1-16, provided that any such arbitration organization and arbitrator(s) will enforce the terms of the Restrictions on Arbitration provision set forth below.
