UK fines 5 firms for cartel behavior on welfare cards

The payments regulators of Britain fined five payments companies including Mastercard a total of 33 million pounds $45.01 million for cartel behavior involving prepaid cards issued to vulnerable people on welfare benefits.

Mastercard was fined the largest fine of 31.56 million pounds $43.04 million. Other companies fined were Allpay, Advanced Payment Solution, Prepaid Financial Services and Sulion.

The Payment Services Regulator PSR said that the firms broke competition law by agreeing not to compete or poach each other's customers on pre-paid cards offered by local authorities to distribute welfare payments to vulnerable people.

The cartel meant recipients of the cards - who included the homeless, victims of domestic abuse and asylum seekers - could have missed out on cheaper or better quality products, the regulators said.

In March last year, the PSR announced it planned to fine the five companies in preliminary findings. It said it had concluded the investigation on Tuesday.

All parties admitted to breaking the law during the course of the investigation.

Chris Hemsley, the Managing Director of the Payment Systems Regulator, said that the investigation and the significant fines we have imposed send a clear message that the PSR has zero tolerance for cartel behaviour.