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Russell Simmons announced Thursday that he's creating a multi-million dollar fund to compensate customers of RushCard, a pre-paid debit card that he founded, the AP reported.
Customers were left in a lurch earlier this month for as many as 10 days when they lost access to the funds saved in their RushCard accounts. The fund will be used to reimburse customers who had incurred late fees to overdue bills or for any other financial hardships they may have faced at the time.
The hiphop mogul spoke to the AP Thursday and said he was devastated and wants to do right by his customers.
The company told the New York Times that "hundreds of thousands" of customers were affected and that it was discussing a reimbursement fund with regulators and was waiting for their approval to start compensating customers.
Richard Cordary, the head of the Consumer Financial Protection Bureau said in a statement last week that the regulator "is prepared to use all appropriate tools at our disposal to help ensure that consumers obtain the relief that they deserve."
The problem started for RushCard users on October 12th after scheduled maintenance took longer than expected. By October 13th, some customers were no longer receiving direct deposits and seeing zeroed-out accounts.
RushCard, along with other prepaid debit cards, targets the millions of low-income Americans who struggle to be served by the traditional banking industry.
LINK: Government Says RushCard Will Be Held Accountable For Failure
LINK: Eight Days OF Chaos For Users Of Russell Simmons' Debit Cards
LINK: This Baltimore Mom Had To Walk To Work On RushCard's 9th Day Out
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