Consumers will share $ 10M for RushCard flub

Customers were unable to access direct deposit, cash, pay bills

Thousands of consumers who lost access to their own funds as a result of RushCard financial breakdowns in 2015 will share $ 10 million in restitution from Mastercard and Unirush, a federal watchdog said Wednesday.

A series of preventable failures left many customers unable to use their RushCards to get paychecks and other direct deposits, take out cash, make purchases, pay bills or obtain accurate balance information, the Consumer Financial Protection Bureau said in an enforcement action.

RushCards are reloadable prepaid debit cards advertised as a way for consumers to get speedier direct deposits of government benefits or payroll funds.

UniRush, co- founded by music industry entrepreneur Russell Simmons, failed to provide adequate customer service to consumers who sought help with the breakdown, the CFPB said.

UniRush and Mastercard were ordered to pay a collective $ 3 million fine to the regulator under a CFPB consent order, bringing the total penalty to $ 13 million.

Mastercard spokesman Seth Eisen said the settlement gives customers “an opportunity to be further compensated for inconveniences caused during the disruption.” UniRush did not immediately respond to messages seeking comment.

In a separate federal class- action suit settlement approved in New York in September, UniRush and other defendants agreed to pay up to $ 28.75 million to RushCard holders harmed by the breakdowns. CFPB action came two days after bank holding company Green Dot announced plans to buy UniRush, RushCard and UniRush’s Rapid! PayCard for $ 147 million, plus minimum $ 4 million annual earn- out payments for five years after the deal is finalized.

CHRIS PIZZELLO, AP Russell Simmons was a co- founder of UniRush.