Liquidation of payment card provider affects Finnish immigration and prison services

The company previously supplying prepaid payment cards to the Finnish Prison and Probation Service and the Finnish Immigration Service, known as PFS, has been placed into liquidation, causing disruptions in the management of funds normally allocated to card holders. The liquidation, which was ordered by a court on February 13, 2024, has prompted both government agencies to secure alternative suppliers and negotiate the return of unclaimed funds to their rightful owners.

Prior to its closure, PFS issued cards were extensively used by prisoners and clients of the Finnish Immigration Service to receive various types of allowances, wages, and other payments. However, with the contracts expiring and all old cards being deactivated by November 30, 2023, any remaining balances on these cards have been left in limbo.

Interpath Ireland has been appointed as the liquidator to oversee the dissolution of PFS and the orderly distribution of remaining assets. Under the European Communities’ Electronic Money Regulations of 2011, the funds still held on these prepaid cards are protected, ensuring that card holders will eventually receive their money, though the process has been delayed.

Both the Finnish Immigration Service and the Prison and Probation Service are actively working with the liquidator to facilitate the transfer of leftover funds to cardholders' new accounts. This process has been more complex than anticipated, leading to unavoidable delays.

The Finnish Immigration Service has committed to reaching out to affected clients to provide necessary assistance and guide them through the transition to new payment cards. Meanwhile, the Prison and Probation Service has already taken steps to ensure that all payments to prisoners have been secured with the new card provider.

The situation highlights the challenges and vulnerabilities associated with prepaid card services and underscores the importance of rigorous oversight and backup plans in governmental financial transactions. As negotiations continue, both services are prioritizing the swift resolution of these issues to minimize impact on card holders relying on these funds for their daily needs.

HT