FTC orders MoneyGram to refund customers $115 million after failing to crack down on scammers

Rick Steves

“This distribution of $115.8 million to nearly 40,000 victims—each of whom is being fully compensated for their losses—demonstrates the Department of Justice’s continued commitment to making victims whole.”

As a result of a 2018 action the Federal Trade Commission and the U.S. Department of Justice brought against MoneyGram for failing to crack down on scammers using their payment system, more than $115 million in refunds are being sent to consumers nationwide.

According to the 2018 charges, MoneyGram violated an FTC settlement from 2009, along with a 2012 DOJ agreement in which the company agreed to take proactive steps to reduce scammers’ ability to use their payment system to receive money from consumers.

In the 2009 settlement with the FTC, MoneyGram agreed to put in place a fraud prevention program which, among other things, required the company to promptly investigate, restrict, suspend, and terminate high-fraud agents.

The FTC charged that MoneyGram was aware of continued fraud on their payment network after the settlement, turning a blind eye for years to numerous instances of suspicious payment activity by the company’s agents.

Consumers receiving refunds in this distribution are those who submitted claims during the open claims process in 2021.

“MoneyGram violated an FTC order by continuing to let scammers rip off its customers”

Samuel Levine, Director of the FTC’s Bureau of Consumer Protection, said: “MoneyGram violated an FTC order by continuing to let scammers rip off its customers. The FTC is pleased to be working with our law enforcement partners to provide refunds to claimants. Other firms that facilitate fraud and ignore FTC orders should expect to face similar consequences.”

Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division, commented: “This distribution of $115.8 million to nearly 40,000 victims—each of whom is being fully compensated for their losses—demonstrates the Department of Justice’s continued commitment to making victims whole. This is an example of how the Department will use every tool at its disposal, including in corporate criminal matters, to provide justice to victims.”

Inspector in Charge Christopher A. Nielsen, U.S. Postal Inspection Service, Philadelphia Division, stated: “This $115 million disbursement provides a measure of financial justice for the many victims who were harmed by fraudsters who preyed on them. The U.S. Postal Inspection Service is proud to be part of this exemplary collaborative effort with our law enforcement and regulatory partners, particularly the U.S. Attorney’s Office for the Middle District of Pennsylvania, the DOJ Money Laundering and Asset Recovery Section and the Federal Trade Commission, to facilitate a process where victims are delivered restitution.”

  • Read this next

    Market News

    Eurozone Fights Stagnation Whilst Stock Indices Rally

    European stock markets are defying economic gloom as they continue to soar to all-time highs, showcasing resilience amidst broader economic challenges.

    Web3

    Lisk Partners with Indonesia’s Communications Ministry to Boost Web3 Startup Ecosystem

    Discover the strategic partnership between Lisk and the Indonesian Ministry of Communications and Informatics, aimed at propelling local Web3 startups to new heights through comprehensive support and education.

    Executive Moves

    Admirals appoints founder Alexander Tsikhilov as CEO

    “Striking the right balance between sourcing new talent and developing and harnessing the strength and capabilities of our current workforce, is key to achieving our vision.”

    Executive Moves

    GCEX appoints Ignacio Corral and Helen Man to UK operation

    GCEX has announced the appointment of Ignacio Corral and Helen Man to its UK FCA-regulated operation based in London as the firm further expands its global business on account of increasing demand for its digital prime brokerage services.

    Retail FX, Uncategorized

    Public.com to shut down UK operation after eight months

    Public.com’s UK withdrawal reflects broader market dynamics, where increased competition among retail investing platforms, including newcomers like Robinhood and Webull, pressures companies to consolidate their efforts in their most profitable or strategic markets.

    Industry News

    UK FCA commits to swifter enforcement actions

    “Reducing and preventing serious harm is a cornerstone of our strategy. By delivering faster, targeted and transparent enforcement, we will reduce harm and deter others. We will also make greater use of our intervention powers to stop harm in real time.”

    Digital Assets

    Ultimate Crypto Trading Software: Zent Launches Innovative Platform For All Institutional Needs

    Zent, a pioneering software provider for financial institutions, has unveiled its all-in-one platform for high-speed crypto trading across popular exchanges. The “ultimate tool tailored to institutional teams and trading volumes” offers distinct advantages, eliminating hurdles like delays and market impact.

    Digital Assets

    OKX officially launches Turkish crypto trading platform

    “With a crypto adoption rate close to 50%, Türkiye represents a very dynamic and promising market for the industry as it continues to develop. The population’s high level of engagement and understanding of digital assets makes it an ideal environment for OKX, and we’re strongly committed to helping continue to grow this already vibrant ecosystem.”

    Retail FX

    ZA Bank launches US stock trading service ZA Invest

    ZA Invest provides access to over 6,000 US stocks and 3,000 ETFs, and a promotional USD savings interest rate of up to 10% p.a. for eligible users.

    <