It’s not every day that a scammed consumer gets their money back, but 38,889 Americans are about to thanks to a three-pronged effort by federal agencies.
The U.S. Postal Inspection Service, Department of Justice, and the Federal Trade Commission (FTC) have announced that disbursement of over $115 million to consumers has begun.
It's part of the compensation process for victims defrauded through the use of MoneyGram money transfers. And, unlike some settlements where victims may only get pennies on the dollar, these victims will recover their full loss amounts.
The refunds are the result of a $125 million settlement MoneyGram agreed to with the Federal Trade Commission (FTC) after MoneyGram was found to have turned a blind eye to scammers using its platform to fleece consumers and violated two agreements it had made to keep itself out of hot water.
One of those agreements was an FTC settlement from 2009 where MoneyGram agreed to put in place a fraud prevention program to promptly investigate, restrict, suspend, and cut-off fraudsters.
The other was a 2012 DOJ agreement in which the company agreed to take proactive steps to lessen scammers’ ability to use MoneyGram’s payment system to transfer money from consumers.
“MoneyGram violated an FTC order by continuing to let scammers rip off its customers,” said Samuel Levine, Director of the FTC’s Bureau of Consumer Protection. “The FTC is pleased to be working with our law enforcement partners to provide refunds to claimants. Other firms that facilitate fraud and ignore FTC orders should expect to face similar consequences.”
The checks are reportedly in the mail to consumers who submitted claims during the open claims process in 2021. However, if a consumer lost money to a scammer via MoneyGram and did not receive a determination notice, they may check the status of their petition by visiting the “Status” tab on this website.
Further questions may be directed to DOJ’s MoneyGram Remission Administrator by phone at 844-269-2630 or by email at email@example.com.
Has MoneyGram learned its lesson?
When ConsumerAffairs searched MoneyGram’s website to see if the company has put on a new game face to distance itself from scam activity, all indications are that it’s making an effort. For one thing, it says “protecting customers is a priority.”
The company seems to be on top of all the current scams – the IRS impersonation scam, charity scams like ones linked to the earthquake in Turkey and Syria, romance scams, and refund scams, as well as a slate of other scams like foreign lottery and buying a vehicle.
MoneyGram advises anyone who’s asked to send money through its service to bone up on the tricks that scammers have used the company to perpetrate.
Among the "nevers" are these four tips:
Never wire money to someone you don't know is rule number one.
Never ever deposit a check from someone who asks you to send some of the money back to them.
Never wire money to a relative who says they're in the middle of a crisis until you check out the story first. Ask questions to verify the person's identity.
Never send money to receive money.
And there are three things consumers should always do before sending money via MoneyGram:
Know who you are dealing with, especially if it's about an unsolicited prize or gift offer. MoneyGram advises to never trust a message like: "Congratulations, you just won $1,000 in a foreign lottery!"
Do the research on an offer to be sure it's real. If it sounds too good to be true, it probably is.
'Remember wiring money is like sending cash. When you send it, it's gone - you can't get it back," the company advises.
But, if anyone suspects fraud, MoneyGram has two ways that it might be able to help: reporting fraud online through this form; and by calling its Customer Care Center at 1-800-933-3278 in order to have the transaction canceled immediately.