MoneyGram Settles Claims that it Transferred Money to Fraudsters
MoneyGram Payment Systems, accused of transferring money to criminals defrauding customers, will pay $13 million to settle those claims with 49 states and Washington D.C.
The money will go toward a nationwide consumer restitution program and for the states’ costs and fees related to the case, according to a statement from the Virginia attorney general’s office. MoneyGram customers who filed complaints about the fraud between July 1, 2008, and Aug. 31, 2009, are eligible for restitution, though it was unclear how much money customers might get.
“Scammers and con artists use a whole range of increasingly sophisticated schemes to persuade consumers to wire them money,” said Virginia Attorney General Mark Herring. “These can range from the ‘grandparent or relative in distress’ scam, in which a fraudster contacts a grandparent and falsely claims that money must be wired to assist with a grandchild’s medical or legal emergency, to lottery and contest scams in which consumers are told they have won a large sum of money but must first wire money to pay required taxes or fees before receiving their winnings.”
According to the Virginia attorney general’s office, “MoneyGram has agreed to maintain and continue to improve a comprehensive and robust anti-fraud program designed to help detect and prevent consumers from suffering financial losses as a result of these types of fraud-induced wire transfers.” That push will include the firing of agents who fail to take “reasonable steps” to reduce fraudulent money transfers, a hotline that agents can use to report fraud risks and other steps.
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