RushCard, Mastercard Fined Over 2015 Customer Lockout
February 01 2017 - 01:55PM
Dow Jones News
By Yuka Hayashi
WASHINGTON -- UniRush LLC and a unit of Mastercard International
Inc. agreed to settle charges by a federal regulator that
"preventable failures" by the companies caused a 2015 debacle in
which tens of thousands of customers lost access to their
prepaid-card accounts, setting off a cascade of unpaid bills.
The Consumer Financial Protection Bureau said the two companies
are paying an estimated $10 million to customers affected by the
temporary lockup of their accounts caused by a technical glitch.
The companies are also paying a civil penalty of $3 million.
UniRush is the program manager of RushCard, a major prepaid-card
business founded by hip-hop producer Russell Simmons . Mastercard
Payment Transaction Services, a unit of Mastercard International,
is the payment processor of RushCards.
"We are pleased to bring this matter to a close, allowing us to
further enhance the best practices, policies and procedures for
prepaid cards," a Mastercard spokesman said. He added that the
company understands "the critical role prepaid cards play in how
people manage their money."
UniRush couldn't immediately be reached for comment.
Green Dot Corp., a prepaid-card company, said Monday that it
reached a deal to buy UniRush for $147 million.
Write to Yuka Hayashi at yuka.hayashi@wsj.com
(END) Dow Jones Newswires
February 01, 2017 13:40 ET (18:40 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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