WESTERN UNION TO PAY NEARLY $600 MILLION, REFUND CONSUMERS NATIONWIDE OVER CLAIMS OF WIRE TRANSFER SCAMS

WESTERN UNION TO PAY NEARLY $600 MILLION, REFUND CONSUMERS NATIONWIDE OVER CLAIMS OF WIRE TRANSFER SCAMS

AG Healey Offers Tips for Consumers

BOSTON – A national wire transfer provider has agreed to pay $5 million, a portion of which will go to Massachusetts, to resolve a multistate investigation into use of its services to facilitate fraudulent money transfer scams, Attorney General Maura Healey announced today. In a related federal settlement, the company has also agreed to pay $586 million, which includes refunds to Massachusetts victims.

AG Healey’s Office, along with 48 other states and the District of Columbia, participated in the multistate settlement with Colorado-basedThe Western Union Company (Western Union). The settlement resolves a multistate investigation into complaints from consumers that Western Union’s wire transfer services were used to advance schemes to defraud consumers.

“In these scams, fraudsters using Western Union’s services convinced consumers to wire money to remote locations, often outside the country,” said AG Healey. “Western Union took insufficient steps to identify and block these fraudulent transfers. While scam artists use creative and convincing tactics, consumers should always be cautious of any requests for immediate transfers of money, even if they appear to come from people they know.”

Under the terms of the multistate settlement, Western Union has agreed to pay a total of $5 million, of which Massachusetts will receive more than $200,000.

Under a related federal settlement two weeks ago with the Federal Trade Commission and U.S. Department of Justice, Western Union agreed to pay $586 million to provide refunds to victims of fraud-induced wire transfers nationwide, including Massachusetts victims. 

The settlements require Western Union to take additional steps to help detect and prevent incidents of fraud. The settlement with AG Healey’s Office gives the office the authority to enforce certain portions of the federal agreement including:

·         Prohibiting the processing of money transfers when Western Union knows or reasonably should know that the transfers are induced by fraud or through a telemarketing scheme;

·         Requiring the company take steps to protect consumers, including interdiction, fraud warnings, and reimbursement of funds in certain circumstances; and 

·         Requiring the company to perform due diligence, monitor agents (including background checks and mandatory training), and investigate and discipline agents regarding their fraud prevention performance.

In Feb. 2016, AG Healey’s Office was part of a similar multistate settlement with MoneyGram, in which they agreed to pay $13 million to resolve a multistate investigation into fraudulent money transfer scamsand provide restitution to eligible consumers. 

            AG Healey warns consumers to be extremely suspicious if they receive a telephone call, voice message, email or text message from someone asking for money or personal information, including when:

·         The person making the request is a stranger — in this country or anywhere else;

·         The person claims to be a friend or relative in a crisis;

·         The person claims to be in another country or a far-away location;

·         The person claims to be in trouble and urgently needs money;

·         The person requests secrecy;

·         The person asks for the funds to be sent by wire transfer.

Always verify that the person making the request, particularly if it comes in written form, is who he or she claims to be.

Additional information and resources pertaining to consumer scams are available on the Attorney General’s website. Consumers with concerns can call Attorney General Healey’s Consumer Hotline at (617) 727-8400. The FTC also provides information about money wire scams on their website, www.ftc.gov. 

This matter is being handled and the settlement will be implemented by staff from AG Healey’s Insurance and Financial Services Division, including Emily Garvey, Erica Harmon, Glenn Kaplan, and Jenna Snow. Consumers with questions about the settlement should contact Attorney General Healey’s Financial Services Hotline at 888-830-6277.