12/20/2023

U.S. Bank to Pay $36 Million for Illegal COVID-19 Pandemic Conduct

It incorrectly used anti-fraud controls, negatively impacting its clients

U.S. Bank will pay $36 million over allegations the company illegally blocked out-of-work consumers from accessing unemployment benefits during the coronavirus pandemic, top federal banking regulators announced on Tuesday.

At the onset of the COVID-19 pandemic, U.S. Bank had contracts with at least 19 states and the District of Columbia to deliver unemployment benefits to millions of newly out-of-work Americans through its prepaid card.

But due to expanded anti-fraud controls, the nation's fifth-largest lender froze tens of thousands of prepaid card accounts without leaving users a way to regain access, according to the U.S. Office of the Comptroller of the Currency (OCC) and U.S. Consumer Financial Protection Bureau (CFPB).

Please select this link to read the complete article from Reuters.