The US Consumer Financial Protection Bureau (CFPB) has ordered MasterCard and UniRush to pay $13m over a technology breakdown in 2015 that left thousands of RushCard users unable to access their funds.
The $13m payment includes a monetary penalty of $3m to CFPB Civil Penalty Fund, as well as an estimated $10m in restitution to the affected customers.
The consumer watchdog said that a series of preventable failures left many customers unable to use their RushCards to get paycheques and other direct deposits, take out cash, make purchases, pay bills or obtain accurate balance information, the CFPB said in an enforcement action.
During its investigation, the CFPB found that MasterCard or UniRush denied consumers access to their own money, botched the processing of deposits and payments, gave consumers inaccurate account information, and failed to provide customer service to consumers impacted by the breakdowns. These actions before, during, and after the changeover harmed tens of thousands of consumers.
CFPB director Richard Cordray said: “MasterCard and UniRush’s failures cut off tens of thousands of vulnerable consumers from their own money, and threw some into a personal financial crisis.
“The companies must set things right for consumers and make sure such devastating service disruptions are not repeated.”
The CFPB has also asked MasterCard and UniRush to work out a plan to prevent future service disruptions. The federal agency will monitor the companies for compliance as they implement the plan.