William Eichler 01 April 2021

Pre-paid card firms supplying councils acted ‘as a cartel’, regulator says

Pre-paid card firms supplying councils acted ‘as a cartel’, regulator says image

Three out of five firms that issue councils with pre-paid cards have admitted to breaching competition rules and agreed to pay maximum penalties totalling over £32m.

The Payment Systems Regulator (PSR) has alleged that Mastercard, allpay, APS, PFS and Sulion engaged in anti-competitive behaviour by agreeing not to poach each other’s clients.

The case relates to pre-paid cards that are used by local authorities to distribute welfare payments to vulnerable members of society.

The regulator alleges that there were two infringements of the Competition Act 1998 that took the form of market sharing or customer allocation. One lasted between 2012 and 2018 and involved all five parties and the other was between 2014 and 2016 and involved APS and PFS.

Chris Hemsley, managing director of the PSR, commented: ‘Pre-paid card services, like these, can provide significant benefits to local authorities as one way to make welfare payments to some of the most vulnerable people in society.

‘By colluding in this way, we consider the parties were acting as a cartel. Because of the reduced competition local authorities may have been missing out on an alternative supplier or products that were either cheaper or better suited to both their needs and the needs of those using the pre-paid cards.

‘Collusion in payments is absolutely unacceptable. Where we see it happening, we will take action, stop it, and seek to impose significant penalties.’

Mastercard, allpay and PFS agreed to settle last month and admitted that they took part in the alleged anticompetitive arrangement. Should the PSR ultimately conclude that there have been infringements, the three companies have agreed to pay fines of £32m.

Time for a council tax precept to fund CCTV image

Time for a council tax precept to fund CCTV

The crisis in funding for CCTV systems is not being addressed by the government or the police and is leading to the curtailment of this vital service in local authorities across the country. How can we ensure that communities that want this service continue to receive it, asks Tom Reeve.
SIGN UP
For your free daily news bulletin
Highways jobs

Service Director – Development & Regulation

West Berkshire Council
Up to £96,585 per annum
We are looking for a candidate with the passion for place making and a successful track record in leading and developing large multi-service teams.  Newbury, Berkshire
Recuriter: West Berkshire Council

Mayoralty & Business Manager

London Borough of Richmond upon Thames and London Borough of Wandsworth
£41,292 - £50,034
The Mayoralty & Business Manager will be responsible for maintaining the reputation of both Mayoralties and promoting a positive image of... London (Greater)
Recuriter: London Borough of Richmond upon Thames and London Borough of Wandsworth

Joint Assistant Director - Communities and Wellbeing

Babergh & Mid Suffolk
£75,000
Babergh and Mid Suffolk District Councils are at the forefront of joint working and are a progressive award-winning partnership Ipswich, Suffolk
Recuriter: Babergh & Mid Suffolk

Procurement Networking Event

Essex County Council
Negotiable
Procurement Networking EventClosing Date
Recuriter: Essex County Council

Community Support Worker - Mental Health & Wellbeing

Essex County Council
£21057 - £27391 per annum
Community Support Worker - Mental Health & WellbeingFixed Term, Full Time£21,057 - £27,391 per annumLocation
Recuriter: Essex County Council

Public Property

Latest issue - Public Property News

This issue of Public Property examines how how flexible workspaces can lead the way in regeneration for local authorities, Why local authority intervention is key to successful urban regeneration schemes and if the Government’s challenge of embracing beauty is an opportunity for communities.

The March issue also takes a closer look at Blackburn with Darwen Council's first digital health hub to help people gain control over health and care services.

Register for your free digital issue