MS gets cut of payout from wire service scam

ftc-stop-payday-loan-scamSource: Mississippi takes cut of payout, clarionledger.com

PDF:westernunion

For years, wire-service scammers have been successful by convincing well-meaning people to wire money to people they’ve never met. It may take the form of a “lottery” you’ve won, a loan for which you have to pre-pay fees, “mystery shopper” scams or dozens of other variations.

But consumers who wire money quickly find they’re left holding the bag for thousands of dollars. Many of these scams use established wire-service companies like Western Union or MoneyGram. Although it’s important to note these companies are just providing the means to transfer the money, advocates have for years argued they’re not doing enough to stop fraudsters from using their services.

Soon, though, Western Union will be sending money to 48 states, the District of Columbia and federal enforcement agencies, and it is being forced to bolster its efforts to stop fraud and inform consumers about the danger of sending money to wire scams.

Mississippi will get $53,180 for its part in the settlement, Attorney General Jim Hood announced last week, and Mississippians may also get part of a $586 million payment to the U.S. Department of Justice, which Western Unionagreed to pay to reimburse consumers who were victims of wire-service fraud. The news release didn’t state how much money individual Mississippians would be getting from the larger settlement.

 “Criminals continue to craft all kinds of schemes to try to convince consumers to wire them money,” Hood said. “Among these common scams are those where consumers have been told they’ve won money or prizes but first must wire money to pay required taxes or fees before they receive their winnings.”

In addition to the financial payout, Western Union has agreed to major changes in its anti-fraud program, including:

  • Anti-fraud warnings on forms that consumers use to wire money.
  • Monitoring, mandatory training and checking up on Western Union agents, to help them recognize and stop fraudulent wire-service transfers.
  • Heightened anti-fraud procedures, to respond to increased fraud complaints.
  • “Prompt and appropriate” disciplinary action against Western Union agents who fail to follow required protocols to stop fraudulent transfers.

“These criminals try to exploit our instinct to protect our family members through scams saying a loved one is in immediate danger and needs money right away,” Hood said in his news release. “Most importantly, consumers who receive solicitations from someone they’ve never met in person should be cautious about wiring money.”

For some tips on spotting, avoiding and reporting wire-service fraud, visit https://www.consumer.gov/articles/1019-money-wiring-scams. For more information about this settlement, visit https://www.justice.gov/criminal-mlars/remission.

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