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Last October, Russell Simmons’ “Rush Card” customers were in for a rude awakening when they tried to use their account. For a demographic mostly made up of low-income users and people without bank accounts, the glitch brought a panic throughout the community. The glitch did not allow users to access their account funds and it would not let transactions on the lock account be processed. It was a double whammy: those who needed money for everyday life items could not use the money and those who used the cards to pay bills could not do so either.

“The glitch left more than 132,000 customers unable to access their accounts for several days. Some cardholders said they had transactions rejected or that they fell behind on bills. The company recognized that their service had caused frustration and unhappiness and damages [to cardholders],” said John Yanchunis, the lead attorney representing the plaintiffs in the class-action suit.”

UniRush, the parent company of the Rush Card, was credited for taking steps to rectify this situation quickly. They “could have enforced an arbitration clause that blocked consumers from the class-action suit.” In laymen’s terms, the settlement was the fastest way to a solution as UniRush had the ability to not only drag this matter out in court, but block any large suits from numerous parties filed against them.

“The settlement includes some of the payments and breaks that customers have already received including $25 credits given to some consumers and a “fee holiday” that waived monthly fees for all customers between November and February. The agreement also called for RushCard to reimburse customers for any fees they paid from Oct. 12 to Oct. 31, the time that they might have been locked out of their accounts. But some customers might qualify for additional funds.”

Though the glitch situation is being handled, UniRush is not out of hot water yet. They are currently under investigation by the Consumer Financial Protection Bureau and were ordered to provide documents for the cause of the glitch. The investigation is still ongoing and an spokesperson for the Bureau declined to comment on any potential ramifications.

SOURCE: Washington Post | PHOTO: Getty

Russell Simmons’ Rush Card Company Expected To Pay $20.5 Million To Customers  was originally published on