The Consumer Financial Protection Bureau (CFPB) has fined U.S. Bank $35.7 million for freezing prepaid debit card accounts during the pandemic, making it difficult for people to regain access.
According to the CFPB, U.S. Bank blocked unemployed Americans from accessing their unemployment benefits on their prepaid debit cards and failed to provide a simple way for accounts suspected of fraud to regain access. The bank also neglected to offer provisional account credits while investigating potentially unauthorized transfers.
As part of the penalty, U.S. Bank will pay $5.7 million directly to affected individuals, a $15 million penalty to the CFPB, and another $15 million penalty to the Office of the Comptroller of the Currency (OCC).
Despite the fines, U.S. Bank has not issued a response or press release regarding the matter.
Hot Take
U.S. Bank’s actions during the pandemic have resulted in significant financial penalties from regulatory authorities. By freezing accounts and blocking access to unemployment benefits, the bank caused undue hardship for many Americans who relied on these funds during a time of high unemployment rates. The CFPB and OCC are holding U.S. Bank accountable for its conduct and ensuring that affected individuals receive compensation for their losses.
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