Western Union pays $586 million and admits to knowing about fraudulent actions News
Western Union pays $586 million and admits to knowing about fraudulent actions

Western Union Co. [corporate website] on Thursday agreed to pay $586 million after admitting [DOJ press release] to turning a blind eye to criminals who used their service for fraud and money laundering. The US Department of Justice (DOJ) [official website] stated [Reuters report] that Western Union has admitted “to aiding and abetting wire fraud.” Western Union was found to have allowed criminals to process transactions, even when the company realized its agents were helping scammers avoid detection. This process allowed for the payment of human smugglers as well as scamming thousands of US consumers. According to authorities, Western Union agents received payment in return for processing the transactions. The settlement will aid in providing refunds to victims of the scams as well as implementing an anti-fraud program.

US banking companies and other financial institutions [JURIST backgrounder] have been under intense scrutiny in the wake of the 2008 financial crisis. The Consumer Financial Protection Bureau ordered [JURIST report] Bank of America to pay $727 million for its illegal credit card practices. The DOJ criticized [JURIST report] the US Sentencing Commission in March 2015 after a federal panel introduced a proposal which would reduce prison time for white-collar criminals. In July 2015 Citigroup, Inc. agreed [JURIST report] to pay USD $7 billion to settle a federal inquiry into mortgage-backed securities sold by the bank prior to the financial crisis. The US Supreme Court granted certiorari [JURIST report] in April 2015 to hear a mortgage lending case in which Countrywide failed to provide required information and the borrowers attempted to rescind the loan. In February 2015 the Supreme Court heard oral arguments [JURIST report] on a subprime mortgage fraud case. Earlier that month JPMorgan Chase paid [JURIST report] a USD $614 million settlement to the US government for its role in approving unqualified mortgages for government insurance.

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