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Western Union to Pay US$586 Million to the U.S. Government for Fraud Victims

Western Union, the global money transmitter, admitted to criminal violations after the firm looked the other way when some employees abetted consumer fraud and money laundering on a widespread basis. The firm has agreed to pay US$586 million to settle U.S. criminal and civil charges that it willfully failed to maintain an effective anti-money laundering (AML) program and aided and abetted wire fraud.

According to the U.S. Justice Department, admissions from Western Union showed that between 2004 and 2012, the firm violated U.S. laws by processing hundreds of thousands of transactions for its agents and others involved in an international consumer fraud scheme. Crooks contacted victims in the U.S. and falsely posed as family members in need or promised prizes or job opportunities before directing the dupes to send money through Western Union to help their relative or claim their prize. Various Western Union agents were complicit in these schemes, often processing the fraud payments for the fraudsters in return for a cut of the proceeds, said authorities. Western Union is accused of knowing about the suspect agents yet refused to take action. For years the firm recorded customer complaints but failed to follow its own proposed guidelines on suspending agents.

News Characteristics

Date : Jan 19, 2017
Region : North America
Industry : Banks
Function : Risk Management
Sub-Function : Fraud Management