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The payment “brings some measure of justice for the elderly and other victims,” Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division said.
It’s only just a start, though.
Before it’s done, Western Union must pony up $586 million, which the government is making available to compensate victims of international consumer fraud schemes that used the money-wiring service.
Phone scammers rely on money transfer businesses such as Western Union to collect cash from their victims, whom they’ve convinced need to pay immediately to help a grandchild who’s been arrested, to collect lottery winnings or to help an online love interest afford to come to the United States – all bogus stories, authorities noted.
In most cases, “money transfer businesses are used to facilitate the crimes,” U.S. Attorney for Pennsylvania David J. Freed said.
“The losses and the number of victims in this case are staggering,” Assistant Postal Inspector in Charge John Walker of the U.S. Postal Inspection Service’s Philadelphia Division said. “Some lost their life’s savings.”
Certain owners, operators or employees of Western Union agent locations were complicit in the schemes, federal authorities said.
So was the company itself, they said, which failed to suspend or terminate complicit agents and allowed them to continue processing fraud-induced transactions.
“Western Union turned a blind eye to the fraudulent payments made through its money transfer system,” said Andrew Smith, director of the Federal Trade Commission’s Bureau of Consumer Protection. “We’re glad to be returning money to those consumers who were ripped off by fraudsters exploiting the Western Union system, and we will not tolerate Western Union or other payments companies facilitating fraud.”
Western Union agreed to pay the money when it entered into what’s known as a deferred prosecution agreement (DPA) with the United States three years ago.
Western Union acknowledged responsibility for its criminal conduct, which included violations of the Bank Secrecy Act and aiding and abetting wire fraud. The company also simultaneously resolved a parallel civil investigation with the Federal Trade Commission.
This first round of payments is one of several expected to occur in the Western Union remission. The Department of Justice sent petitions for remission to more than 500,000 potential victims of the Western Union fraud and anticipates authorizing compensation for many more in the coming months.
MORE INFO: www.westernunionremission.com
Further questions may be directed to the Western Union remission administrator by phone at 844-319-2124 or by email at info@WesternUnionRemission.com.
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