Global remittance company Western Union will have to pay the price for its assistance in wire fraud and other violations.
After admitting to committing wire fraud, the money service company agreed to pay the amount of $586 million. Western Union revealed that the proceeds will go to the Federal government as a reimbursement for the consumers who became victims of fraud. The Department of Justice, in a statement published in the website of Two Way, said that Western Union, was "willfully failing to maintain an effective anti-money laundering program."
As reported in the website of 88.5 WYSU, the settlement entered into by Western Union comes with safeguards against future fraud. In coordination with the Federal Trade Commission, the company will also be prevented from transmitting a money transfer that it knows or reasonably knows is induced with fraud. The FTC also required Western Union to:
- Stop any money transfer being sent to a person who is part of a fraud report
- Give consumers a clear and conspicuous fraud warning on both its paper and electronic money transfer forms
- Boost the number of available websites and telephone numbers for consumers to file a fraud-related complaint.
- Refund a fraud-induced money transfer should it fail to comply with its anti-fraud policy.
One common scheme by the fraud perpetrators involve contacting customers in the US and posing as needy family members or promising prizes or jobs in exchange for sending money b through Western Union. As stated in the website of Maine Public, the DOJ made a statement that agents from Western Union still processed fraud payments for the customers in exchange for a cut from the proceeds of the fraudulent transfer.
""Had Western Union implemented a recommended anti-fraud program, it could have prevented significant fraud losses and would have resulted to corrective action against the over 2,000 agents between 2004 and 2012" as stated in the DOJ findings.
