Victims to Get Back $18M from Wire-Transfer Scams

MoneyGramMore than 34,000 checks totaling nearly $18 million are being mailed to those identified as victims in a series of cross-border fraud schemes that involved payments through MoneyGram International, the second-largest U.S. wire-transfer company.
The Federal Trade Commission is arranging the mailings. The redress checks average $520, and the FTC urges consumers to cash them within 60 days.
In October 2009, the FTC charged that MoneyGram agents helped fraudulent telemarketers and other scammers “who tricked U.S. consumers into wiring millions of dollars within the United States and to Canada.”
The consumers utilizing MoneyGram had been falsely told they had “won a lottery, were hired for a secret shopper program, or were guaranteed loans,” the FTC said.
Most of the scams involved counterfeit checks mailed to potential victims to get them to send money back by wire transfer. Victims were told they had won a lottery or other prizes, but had to pay a fee for taxes, customs duties or insurance to a third-party.
MoneyGram knew that its wire-transfer system was being used to defraud people, the FTC alleged, and the company did very little about it.
According to the FTC’s complaint, MoneyGram “knew, or avoided knowing,” that about 131 of its more than 1,200 agents accounted for more than 95 percent of the fraud complaints it received in 2008 regarding money transfers to Canada, a common destination for these types of scams.
Minneapolis-based MoneyGram operates a network of about 180,000 agents in 190 countries and territories. In its complaint, the FTC charged that in recent years this network has increasingly been used by telemarketing scammers to prey on U.S. consumers.
The FTC has more information on money transfer schemes.

Leave a Reply

Your email address will not be published. Required fields are marked *