RushCard Denied Request to Delay Prepaid Card Investigation
Prepaid card issuer RushCard has been under fire for over a month due to an outage of their network in mid-October. After heavy scrutiny from the Consumer Financial Protection Bureau, RushCard’s parent company, UniRush, submitted a request to delay their investigation and reduce the number of documents the CFPB was requesting.
Last Wednesday, the CFPB denied the request and told UniRush to provide a detailed statement within 10 days.
The statement the CFPB is requiring would detail the time UniRush expects to spend answering questions from the Bureau and submitting all the requested documents. The CFPB is also requesting an explanation as to why the company needs additional time to meet their demands.
When RushCard moved to a new payment processor on October 12, technical problems ensued that left hundreds of thousands of RushCard customers unable to access their funds. Some users lost access to their money for as long as two weeks.
In November, UniRush said they had put together a “multi-million dollar fund” to compensate prepaid cardholders who were unable to access their accounts during the outage. Many RushCard users are unbanked, and they use their prepaid cards much like a banked consumer would use a debit card with a checking account. As a result of the outage, users with no access to their money were unable to pay bills or complete any financial transactions, but they have yet to see compensation for their inconvenience.
“We are committed to working cooperatively with the CFPB and have already begun to produce the documents they’ve requested,” a spokesperson from RushCard told Quartz.