Tales of money-transfers gone awry are frequently reported to Better Business Bureau. Scammers often utilize money-transferring services to attain funds almost instantly, while remaining anonymous and undetected. Wronged consumers ask, "Will I ever get my money back?" Sadly, the answer is usually no, but for some, that may change.
The Federal Trade Commission recently announced that it is holding MoneyGram International, Inc., the second-largest money transfer service in the United States, partially responsible.
The FTC charged that MoneyGram knowingly allowed fraudulent transactions in its money-transfer system. MoneyGram was ordered to pay $18 million, which the FTC will use as restitution for victimized consumers. Without admitting wrongdoing, the company has agreed to pay the fine.
The order also requires MoneyGram to enforce more supervision and regulation to combat deceptive activity among its agents or other internal sources. MoneyGram must also work very closely with the FTC to implement its anti-fraud and agent-monitoring program.
"The money-transferring system has long been abused by thieves, with thousands of hard-earned consumer dollars sacrificed," said Robert W.G. Andrew, CEO of BBB serving Alaska, Oregon, and Western Washington. "We are glad to see accountability in this industry and encourage businesses to take steps toward self regulation."
BBB encourages consumers to avoid all unknown or suspicious invitations to wire funds. Cons often initiate money-transfer scams using the following lures: lotteries, sweepstakes or prizes; guaranteed loans; free government money; and job opportunities. Fake solicitations may include a counterfeit check—to deposit it into a bank account—and instructions to wire a small fee for taxes, insurance or processing services in order to complete the transaction. In the end, the check bounces and the transferred funds are gone permanently, or consumers receive the funds but they are stolen from another's account and the consumer must pay them back to the rightful owner.
Read the FTC's recent press release. Consumers who lost funds in a MoneyGram transfer can contact the FTC at 202-326-3755.