November 14, 2005
CURRAN ANNOUNCES AGREEMENT WITH WESTERN UNION REGARDING
Attorney General J. Joseph Curran, Jr. announced
today that Western Union Financial Services, Inc. has agreed
to take steps to address
the use of the company’s wire transfer services by fraudulent
telemarketers. Under the Agreement between Western Union and 47
states and the District of Columbia, Western Union, will, among
other things, fund an $8.1 million national consumer awareness
program and set out very prominent consumer warnings on the forms
used by consumers to wire money.
The problem addressed by the Agreement is the high
number of "fraud-induced
transfers"–that is, money wired by consumers to fraudulent
telemarketers and other scam artists. For example, some telemarketers,
often based in other countries, use a "lottery" scam,
in which they tell consumers they have won a large sum of money
but must pay taxes or other charges in order to claim the winnings.
The victims are then directed to send the money by wire, because
wire transfers are fast, there are transfer agents in most communities,
and funds can be picked up in multiple locations.
"I am pleased that Western Union is taking steps to diminish
the use of its wire transfer network by scam artists," Curran
said. He advised consumers that they should be wary about wiring
money to people the consumers do not know in foreign countries.
Among the terms of the Agreement are these:
• Prominent warnings to consumers of the dangers of wire-induced
wire transfers must appear in English and Spanish on a new front
page of Western Union’s Send Form, and comparable warnings
are required for telephone and Web transfers.
• Western Union will pay $8.1 million over
five years for national peer-counseling programs to be overseen
by the AARP Foundation
and designed to reach at least 3 million consumers.
• Western Union will reimburse the amount
of any transfer plus fees to any consumer who requests, prior
to pickup, that a
transfer be stopped and who reasonably claims that the transfer
• Western Union will send monthly anti-fraud emails to its
agents, revise the company’s agent training video and manual,
and provide enhanced training to agents with elevated fraud levels
at their locations.
• Western Union will terminate agents who
are involved in fraud, and suspend or terminate agents who do
not take reasonable
steps requested by WU to reduce fraud.
• Western Union will block wire transfers
from specific consumers or to specific recipients when Western
information from a state that there is reason to believe that fraud
will occur, until such time as the consumer is counseled on fraud
and requests resumption of the transfer.
Western Union Financial Services is a wholly-owned subsidiary
of First Data Corporation, based in Greenwood Village, Colorado.
Signing the Agreement were the States of Alabama, Alaska, Arizona,
Arkansas, Colorado, Connecticut, Delaware, Georgia, Hawaii, Idaho,
Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland,
Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Montana,
Nebraska, Nevada, New Hampshire, New Jersey, New Mexico, New York,
North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Rhode Island,
South Carolina, South Dakota, Tennessee, Texas, Utah, Vermont,
Virginia, Washington, West Virginia, Wisconsin, Wyoming, and the
District of Columbia.