U.S. Bank fine overview:
- Who: The Consumer Financial Protection Bureau and Office of the Comptroller of the Currency announced a $36 million U.S. Bank fine.
- Why: U.S. Bank improperly prevented consumers from accessing their unemployment benefits during the COVID-19 pandemic.
- Where: The U.S. Bank fine will pay $5.7 million to certain U.S. consumers whose accounts were frozen.
U.S. Bank will reportedly pay a fine of nearly $36 million over allegations it froze tens of thousands of accounts and prevented consumers from accessing unemployment benefits during the COVID-19 pandemic, Law360 reports.
The Consumer Financial Protection Bureau and Office of the Comptroller of the Currency (OCC) announced the U.S. Bank fine on Dec. 19, in which the bank will pay a $15 million penalty and pay $5.7 million to consumers whose accounts were frozen. The OCC also issued a separate $15 million U.S. Bank fine.
U.S. Bank employment benefit investigation found bank improperly denied account access
The CFPB and OCC jointly investigated the U.S. Bank unemployment benefit freeze issue and found that the bank failed to allow customers to quickly regain access to their frozen accounts during the COVID-19 pandemic. U.S Bank also allegedly failed to provide provisional account credits while it looked into potentially unauthorized transfers.
U.S. Bank reportedly had contracts to deliver unemployment benefits to millions of consumers who were unemployed during the COVID-19 pandemic. The U.S. Bank unemployment benefit was provided through a ReliaCard prepaid card.
However, U.S. Bank allegedly froze those customers’ accounts for weeks at a time due to the anti-fraud measures it implemented. Due to these expanded measures, the CFPB alleged the bank did not have an adequate method for consumers to verify their identities to unfreeze their accounts.
Bank failed to provide provisional account credits on reported unauthorized transfers
Additionally, U.S. Bank failed to provide consumers with provisional account credits when they reported unauthorized transfers, the CFPB said. In many cases, the bank allegedly improperly required consumers to provide written information about the reported unauthorized transfers from their accounts.
“At a time when employment was close to 15%, many out-of-work Americans throughout the country had little choice but to rely on U.S. Bank for their unemployment benefits,” CFPB Director Rohit Chopra said in a statement.
“U.S. Bank blocked access to accounts and demanded burdensome paperwork in order for consumers to regain access to their frozen benefits.”
U.S. Bank says the issues stemmed from the massive 4,000% growth of the ReliaCard program during the COVID-19 pandemic. The bank says it “stepped up to enable the government to provide assistance to those in need during the pandemic” and that it prevented more than $375 million in fraud due to its enhanced anti-fraud efforts.
Earlier this year, U.S. Bank was sued by an investor in the wake of allegations the bank opened unauthorized accounts that resulted in a $37.5 million fine from the CFPB.
Did you experience frozen U.S. Bank unemployment benefits during the COVID-19 pandemic? Tell us your story in the comments.
The CFPB U.S. bank fine case is In the Matter of: U.S. Bank National Association, Case No. 2023-CFPB-0019, before the U.S. Consumer Financial Protection Bureau. The OCC U.S. Bank unemployment benefit case is In the Matter of: U.S. Bank National Association Cincinnati, Ohio, Case No. AA-ENF-2023-64, before the U.S. Department of the Treasury, Office of the Comptroller of the Currency.
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31 thoughts onU.S. Bank to pay $36M over pandemic unemployment benefit freeze
PLease add me! I’m owed 32,000.00 and have the paperwork to back it up. We were getting it just fine then it was frozen and I fought it for close to a year and a half. And this was after I was told it would be started again! Never received it but the state is claiming over payment and theast 1 times I filed Ks kept my refund!
I know what you’re going through with U.I. and with U.s.bank. The bank and U.I. committed many state and federal regulations violations and criminal law they should be charged for the crimes they did to the citizens of this country. U.I. ran the pua program using U.I. stipulations and requirements. Pua program has its own program stipulations that’s why the program applies to self-employed workers who don’t qualify for regular U.I. and the stipulations requirements are not the same. That’s why so many people have been disqualified. They didn’t know anything about the program and made their own decisions and rules and giving false statements and misleading information at their own discretion. Committing fraud. Many violations. This is the best one. Every appeal that was done through the appeal court or hearing was illegal. Look up U.I. appeal procedures under sub chapter C 823.21 through 27. The hearing between you and U.I. and the hearing officer works for U.I. and is supposed to be a neutral party and can not answer for either party. Now about the bank. Also committed fraud and many violations for not managing the prepaid debit card service properly and not following legislation and state and federal government regulations laws. Also there are many violations that they can be charged for what they have done that nobody has ever mentioned. But I know and I’m working on it. I just need the right backup willing to back me up. But this is a 700 billion dollar bank. What I know and saying is the truth.
Colorado unemployment owes me money big time
My US Bank unemployment account was frozen at the end of July 2020,due to my purse & wallet being stolen. I reported this along with several unauthorized transactions. Was told I must send copy of drivers license. Since all gov. offices were closed it took until the middle of Oct to obtain! Meanwhile, my money was being deposited & withdrawn!!! The bank itself I learned withdrew 12.50 for an expedited card! During the ” freeze”, so I lost every penny that was in my account before frozen & all payments made & stolen while ” frozen.” US Bank was a nightmare from the start! I almost died from Covid 19. Then I had my Mother in home hospice,hospitalized by 1st & 2nd vaccine. I gave up on Bank!!!
I has my account frozen for over 2 months I had to call my state representative to contact them and try and get it going again I had all the paperwork needed I was living in a hotel at the time having to pay 350 rent a week after 8 weeks no payment they booted me out and I had to pay all that money back later or they were going to sue me all because the anti fraud measures they were doing it really messed me up good for quite a while
I Veronica B unemployment benefits was frozen for two months
i just got a letter from the us bank saying that I need to verify my identity and thaty benefits was expunged from the card due to not using them this was i December 23,and i had deposits of 10,000 and more going to the card but didn’t receive the payment