U.S. Bancorp Fined $36 Million for Frozen Unemployment Accounts

U.S. Bancorpwill pay $36 million to settle regulators’ claims that it improperly kept unemployed Americans from easily accessing benefits through assistance programs at the peak of the Covid-19 pandemic.

The Consumer Financial Protection Bureau said Tuesday that fraud concerns prompted the lender in 2020 to freeze tens of thousands of benefit accounts that it was contracted to fill with government unemployment funds. However, the bank lacked a clear process for people whose accounts had been frozen to prove their identities and use the prepaid assistance cards, according to the watchdog.

U.S. Bank, as the firm’s bank subsidiary is ...