A team of attorneys and other staff at the Federal Trade Commission today received a prestigious Samuel J. Heyman Service to America Medal (Sammie) for their public service in negotiating a historic $586 million settlement with Western Union that will provide refunds to hundreds of thousands of consumers who lost money through fraud-induced money transfers.
Team leader Karen Dodge, and Joannie Wei, Elizabeth Scott, and Doug McKenney, all in the FTC’s Midwest Region office in Chicago, received the Homeland Security and Law Enforcement Medal, jointly with a team from the Department of Justice.
The FTC team obtained a $586 million settlement with Western Union, the largest money transfer company in the world, after an exhaustive investigation revealed that Western Union had facilitated fraud against consumers worldwide through its global money transfer system. Evidence uncovered in the investigation demonstrated that Western Union was aware of and profited from the frauds, but did not stop them, and that the company failed to take corrective action against Western Union agents who were involved in or facilitated fraud-induced money transfers.
The settlement was reached in coordination with the Department of Justice, which negotiated a Deferred Prosecution Agreement under which Western Union admitted to criminal violations and agreed to similar relief.
Over the past fifteen years, money transfers have become the payment method of choice for scam artists seeking to defraud consumers in the U.S. and abroad. Scammers ask consumers to pay by money transfer because that payment method is fast and makes it extremely difficult for law enforcement to identify and take action against the perpetrators of fraud.
The team negotiated a groundbreaking settlement under which Western Union agreed to pay restitution, and also agreed to an injunction that requires the company to implement a comprehensive anti-fraud program. The injunction includes innovative provisions that require Western Union to, among other things, block money transfers sent to any person who has been the subject of a fraud complaint and refund a fraud-induced money transfer if the company failed to comply with certain anti-fraud procedures in processing the transaction. This injunction will prevent hundreds of thousands of additional consumers from losing money through Western Union money transfers in the future.
The FTC and DOJ are currently in the process of returning the $586 million to victims. On November 13, 2017, more than 500,000 claim forms were mailed to consumers who had previously reported sending a fraud-induced money transfer through Western Union between January 1, 2004 and January 19, 2017. Consumers who did not receive a claim form also were able to file claims. The claims deadline was May 31, 2018.
The Service to America Medals were created in 2002 by the Partnership for Public Service, a nonpartisan, nonprofit organization committed to revitalizing federal government service, and the Atlantic Media Company (publisher of Government Executive, National Journal and The Atlantic Monthly). Profiles of the awardees are available at www.ourpublicservice.org.
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