Russell Simmons Agrees To Pay Over $20 Million To RushCard Customers

News & Views | Gerren Keith Gaynor | 05/16/2016 | 11:30 AM EDT

(Photo: Alberto E. Rodriguez/Getty Images)

Hip-hop mogul's prepaid debit card company pays up for massive company glitch

Russell Simmons is ready to right the wrongs of his prepaid debit card company, after a mishap left thousands of customers locked out of their accounts.

RushCard will pay a total of $20.5 million to more than 132,000 customers who said the company glitch left them without access to their funds in a financial bind. According to the Washington Post, $19 million will go toward reimbursing customers for fees and other costs they faced, while the remaining $1.5 million will go toward attorney fees.

“The company recognized that their service had caused frustration and unhappiness and damages [to cardholders],” said John Yanchunis, the lead attorney representing the plaintiffs in the class-action suit.

Customers have already received $25 credits and a “fee holiday” that waived monthly fees for all customers between November and February.

Russell Simmons Reportedly 'Devastated' Over RushCard Scandal

Those affected by the glitch suffered overdraft charges and late payment fees. Customers can receive up to $100 each if they don’t have the paperwork to support their claims, the Post reports, while those with documentation to prove their losses could receive up to $500 each.

“We are pleased to have reached this preliminary settlement which will resolve the claims of our cardholders,” said Rick Savard, the chief executive of UniRush. “We believe this settlement fairly compensates our customers who were inconvenienced.”

The massive settlement still has to be approved by the court. 

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