Pathward Financial will pay about $700,000 in refunds and penalties to resolve claims by the New York Attorney General’s Office that the Sioux Falls, S.D., company illegally froze customer accounts and transferred funds debt collectors.
New York Attorney General Letitia James’s office said in a press release that the $7.9 billion-asset Pathward cooperated with the investigation and voluntarily began remedying its practices last year.
The company will refund roughly $80,000 plus interest to nearly 90 New Yorkers who had funds turned over to debt collectors. Pathward will also pay a $627,000 penalty to address “illegal and deceptive conduct,” according to the release.