Texas AG announces multistate settlement with Moneygram

By David Yates | Feb 11, 2016

AUSTIN – On Feb. 11 Attorney General Ken Paxton announced a settlement with Dallas-based MoneyGram Payment Systems, Inc., resolving a multistate investigation focused on MoneyGram’s role in transferring money from consumers to people defrauding them.

In addition to Texas, 48 states and the District of Columbia participated in this settlement, with Texas serving on the Executive Committee through the investigation and subsequent negotiations, according to a press release.

“In far too many cases consumers, many of them elderly, are harassed or manipulated into sending their hard-earned money to third parties via wire transfers, and this agreement provides additional protections against this fraudulent practice,” said Paxton. “Consumers must always remain aware of these schemes, and view solicitations from strangers promising big winnings with the deepest suspicion. The best defense is to toss these types of letters in the trash, delete these emails or simply hang up the phone.”

As part of the agreement, MoneyGram agreed to maintain and continue to improve a comprehensive and robust anti-fraud program to help detect fraud and prevent consumers from suffering financial losses in fraudulent wire transfers.

MoneyGram has also agreed to pay a total of $13 million to the states, funding a nationwide consumer restitution program, and to cover the states’ costs and fees.

The settlement provides for an independent third party settlement administrator to review MoneyGram records and send notices to all consumers who are eligible to receive restitution under this settlement.

Generally, consumers who are eligible for restitution previously filed complaints with MoneyGram between July 1, 2008, and Aug. 31, 2009 regarding fraud induced transfers sent from the U.S. to foreign countries other than Canada.

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