Western Union to post fraud warnings
Updated: 11/15/2005 8:30 AM MST
ALBANY, N.Y. (AP) - Western Union Financial Services will post prominent warnings to customers about fraudulent telemarketers who increasingly require victims to wire money because it's harder to trace, according to an agreement Monday with 47 state attorneys general.
A two-year review after hundreds of complaints found 38% of transfers from the USA to Canada in 2003 were "fraudulently induced," according to the announcement.
Western Union, part of Denver-based First Data (FDC), handled most of the transactions in hundreds of complaints and the states' review, but it wasn't accused of any wrongdoing.
Western Union volunteered to work to improve consumer protection, said spokeswoman Christine Pritchard of New York Attorney General Eliot Spitzer's office.
Western Union agreed to pay $8.1 million toward a national consumer awareness program to reach 3 million of the most vulnerable customers. It will also pay $400,000 to the states and put warnings on wire transfer forms.
A Western Union spokesman had no comment. The agreement includes all the states but California, Florida and Pennsylvania.
Older consumers have been targeted most by the fraudulent telemarketers, which were often based in Canada and other countries, state officials said. The scams often tricked consumers into wiring substantial amounts of money through sweepstakes, lottery, advance loan fees and other means.
The agreement includes:
. Reimbursing any wire transfer and fee to any consumer who requests, before the pickup of a transfer, to stop the transfer because of fraud concerns.
. Distributing anti-fraud e-mails to Western Union agents and revising training.
. Firing any agents who assist in fraud and firing or suspending any who don't take preventive action.
. Blocking transfers between specific customers and telemarketers if fraud is suspected.
. Developing a computer system to spot likely fraud and increase anti-fraud staff.
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