russell simmons

*A federal investigation and class action lawsuit are not putting a damper on Russell Simmons’ assurance to RushCard account holders that their cards are back to “working” normally.

According to The Wrap, the entertainment mogul took to social media last weekend to welcome efforts to look into the company he created in 2003.

“Honestly excited to see investigations beginning they will expose our operation as squeaky clean,” Simmons tweeted Saturday morning (Oct. 24).

On Sunday morning (Oct. 25), the hip-hop mogul and RushCard co-owner returned to Twitter to reassure cardholders that they would have access to their money.

“Card to card transfers are working,” Simmons tweeted. Thousands had been prevented from accessing their money and raised their concerns on social media.

The Def Jam records co-founder’s comments mark the latest development in the continuing saga surrounding RushCard, “a pre-paid Visa Debit Card mostly used by ‘poor and working class Americans who cannot or choose not to establish traditional banking accounts,’” according to the class action suit, which was filed Friday (Oct. 23) against Simmons’ UniRush Financial, Rush Communications, Meta Financial Group and MetaBank in US District Court in New York.

The lawsuit, filed by five RushCard holders, stems from complaints the company received on social media from users who claimed their cards stopped working. While some cardholders said they were blocked from their accounts, others complained that their accounts had been deactivated or that money was missing and they couldn’t pay bills, buy food or put gas in their cars, The Wrap noted.

The RushCard program was set up to enable users to either have their paychecks or government checks directly deposited onto their cards or load money on the cards themselves and use them to make payments, buy groceries and withdraw cash from ATMs.

Upon realizing what happened, Simmons blamed the problems with RushCard on a technology update on the program’s technology and wrote on the RushCard Facebook page on Oct. 12:

Despite Simmons assurance, cardholders still had problems using their RushCards. Responding to the ongoing issue, another message assuring customers that things were being handled was posted on the RushCard Facebook page on Oct. 21.

The lengthy message apparently wasn’t enough as the class action lawsuit was  later filed.

Details raised in the suit, include a claim that on or about Oct. 11, “some RushCard customers received notice, by text message, that RushCard would be updating its system” for five hours and customers would be unable to access their accounts.

Turns out the RushCard problems carried on for nearly two weeks “with customers locked out” and many “still have not regained access,” the suit stated.

The plaintiffs are seeking “damages and injunctive relief based upon the unlawful conduct of Defendants in denying such account holders the ability to obtain funds in their accounts and in misappropriating funds held in the RushCard accounts.”

Adding to the lawsuit was an announcement made Friday by the Consumer Financial Protection Bureau that it was launching an investigation.

“The CFPB is taking direct action to get to the bottom of this situation that may have harmed thousands of innocent consumers already,” Director Richard Cordray said in a statement. “The CFPB has also engaged in discussions with fellow regulators, including the Office of the Comptroller of the Currency and the Federal Trade Commission, to ensure a comprehensive response that addresses the situation quickly and holds accountable all of the parties involved to make consumers whole.”