Legal cases
In November 2012, MoneyGram International admitted to anti–money laundering (AML) and wire fraud violations as a result of a criminal complaint filed in the Middle District of Pennsylvania charging MoneyGram with willfully failing to maintain an effective AML program and aiding and abetting wire fraud.[39] MoneyGram services were used by unrelated parties involved in mass marketing and consumer phishing scams that defrauded thousands of victims in the United States.[40]
As a part of the settlement, it created a $100 million victim compensation fund. MoneyGram also retained a corporate monitor who reported regularly to the United States Department of Justice for a five-year period, subsequently extended for 30 months after the deferred prosecution amendment was amended. Upon successful completion of the DPA terms in June 2021, the charges of aiding and abetting wire fraud were dismissed.[41]
The company also terminated any agents complicit in the 2009 scams and invested more than $84 million in improvements to the company's consumer anti-fraud systems and consumer awareness education.[40] In February 2015, MoneyGram assisted a Houston reporter in shutting down a fraud scam after discovering a scheme that utilized an account with the company.[42]
In February 2016, MoneyGram agreed to pay $13 million to end a probe stemming from customer complaints that scam artists duped them into wiring funds via the money transfer service. The settlement, with attorneys general in 49 states and Washington, D.C., includes $9 million for a nationwide fund that will facilitate the return of money to some MoneyGram customers and $4 million to cover states' costs and fees, according to numerous announcements by state attorneys general.[43]
In April 2022, the U.S. Consumer Financial Protection Bureau and New York Attorney General filed a complaint against MoneyGram alleging repeated violations of the law, ignoring customer complaints and government warnings. The complaint states that the company has repeatedly "stranded" recipients waiting for their money, provided senders inaccurate information about transfer completion and failed to address customer complaints in accordance with the 2013 rule. (See Consumer Financial Protection Bureau et al v MoneyGram International Inc et al, U.S. District Court, Southern District of New York, No. 22-03256.)[44]
In September 2024, the US District Court for the Eastern District of Texas granted summary judgment in favor of the US Chamber of Commerce and other trade associations, holding that the CFPB operated outside its constitutionL authority when it attempted to regulate “unfair acts” of practices under the Dodd-Frank Act when it updated its examination manual. The CFPB has appealed to the US Supreme Court. As a result, most all high-level litigation brought by the CFPB is on hold awaiting US Supreme Court review and action on the pending appeal.
