Western Union defrauded customers, feds say. You may be entitled to part of $40M refund
Another installment of payments is underway for Western Union customers who petitioned that they were defrauded in an “international consumer fraud scheme,” according to a U.S. Department of Justice news release.
The latest round of refunds — totaling nearly $40 million — is the “first distribution in the second phase” for the Western Union Remission Fund. The second phase opened in March 2022, according to the Sept. 15 release. In the first phase, more than $365 million was paid to nearly 150,000 approved petitioners.
So far, more than 174,000 people will have received “full compensation for their losses,” the release says.
Here’s what you should know about the Western Union Remission Fund and who is eligible to receive payments from the $40 million distribution.
What is the Western Union Remission Fund?
The Western Union Remission Fund, which has $586 million in total, was agreed upon by Western Union after the company admitted to “criminal conduct” in 2017, according to the news release. Criminal activities that Western Union acknowledged included aiding and abetting wire fraud, as well as violating the Bank Secrecy Act, which requires financial institutions to cooperate with federal authorities in the prevention of money laundering.
The company also faced a concurrent civil investigation by the Federal Trade Commission.
Tens of thousands of people were “victims of the international consumer fraud scheme,” the release says.
“Victim assistance is a primary goal of the Department’s Asset Forfeiture Program, and this latest distribution is a testament to the impact asset forfeiture can have in compensating and making victims whole,” DOJ criminal division Assistant Attorney General Nicole Argentieri said in the release.
What were the Western Union scams that took place?
Three scams were highlighted in the news release that federal authorities say were used by fraudsters to take people’s money.
One scheme that specifically targeted seniors — known as the “grandparent scam” — took place through scammers pretending to be a grandchild who was in need of money. Two other scams involved either posing as an online love interest who needed money to visit the person being defrauded or telling someone they won a large cash prize but needed to pay fees.
In all of those scams, those being defrauded were instructed to send their money through Western Union, the release says. The “fraud scheme” persisted for over a decade.
During that period, “certain owners, operators or employees of Western Union agent locations were complicit in the schemes,” according to the release.
“Western Union aided and abetted the fraud scheme by failing to suspend or terminate complicit agents and by allowing them to continue to process fraud-induced monetary transactions,” the release says.
The FTC outlines four signs that show that something could potentially be a scam:
A scammer can pretend to be a part of a trusted organization, such as a government agency or a business you’re familiar with
A scammer can create a sense of urgency by saying you either have a major problem to fix or you need to collect cash prizes
A scammer can pressure someone into feeling like they need to send money immediately
A scammer can insist that someone can only send money through specific payments such as cryptocurrency or a gift card
Who is eligible for Western Union refunds?
Those eligible for refunds were required to file a petition either electronically or by mail. The original deadline to submit a petition was May 31, 2018, but submissions were extended into 2022.
Around 500,000 petitions were mailed to people identified as someone who was defrauded, along with instructions on how to fill out the petition, in 2018, according to the fund’s website. States with some of the highest remission submissions include California, Texas, Florida, New York and Pennsylvania.
Those considered eligible for compensation would submit a claim that they “sent money to a scammer through Western Union” between Jan. 1, 2004, and Jan. 19, 2017, according to the FTC’s frequently asked questions.
The DOJ will still accept petitions from impacted people who did not originally file, according to the news release. For additional questions about the payments, the release encourages people to contact the Western Union Remission administrator at 855-786-1048 or info@WesternUnionRemissionPhase2.com.
Approximately $180 million remains in the Western Union Remission Fund.
“The Justice Department anticipates authorizing more distributions for victims in the coming months,” according to the release.
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