MoneyGram Agrees to Pay $100 Million to Settle Scam Charges

MoneygramDALLAS -- MoneyGram said Friday that it has agreed to set up a $100 million compensation fund as part of a settlement of government allegations of fraud through money-transfer scams from 2003 to 2009.

Under the terms of the deal with the U.S. Attorney's Office for the Middle District of Pennsylvania and the Department of Justice, MoneyGram International Inc. said it has also taken other steps to prevent more scams. These include adding more investigators and beefing up technology to detect fraud.

The payment services provider said it has terminated relationships with the agents suspected of masterminding the fraud. It said it has also overhauled its corporate compliance program and began a new training program for agents to better sniff out and report scams.

The company previously set aside the money to compensate victims.

"The conduct described in the [settlement agreement] is unacceptable to MoneyGram and counter to everything we strive to stand for," said Pamela H. Patsley, chairman and chief executive officer, in a statement. "We take compliance very seriously at MoneyGram, and nothing angers us more than when our services are used to perpetrate illegal activity."

The Dallas-based company also said Friday that it lost $54.1 million, or 77 cents per share, in its third quarter due to costs related to the fraud settlement and related legal expenses. It had net income of $15.8 million, or 22 cents per share, a year ago.

Its revenue rose 5 percent to $338.6 million from $322 million a year ago.

It now expects full-year earnings to come in at the low end of its previous expectations.

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It is amazing to me how the Democratic party has and continues to deceive the public by presenting to the public that it is the party of racial equallity. Am I wrong when I remember Bulldog Turner, Jesse Helms, Strom Thurmond, Al Gore Sr. etc. etc. all of who opposed the civil rights bill of 1964?? Or when a Republican President had to send in the National Guard to Integrate Little Rock High School by removing Governor Faubus(one of the early and strong supporters of Bill Clinton)?? Oh what dreadful lies we weave when clandestantly we try to deceive!!!

November 18 2012 at 11:26 AM Report abuse rate up rate down Reply

I too feel like as advanced as we are in the human race we still fall for the smooth talkers who promise everything and deliver Nothing.
Sad as it is we must at all times be on guard to protect our finances, property, and even our own reputations.

We all need to watch out for the scum buckets that are out there preying on us because their lazy asses choose not to toil and labor like the 98% that have our acts together.

November 09 2012 at 6:23 PM Report abuse rate up rate down Reply

It never ceases to amaze me how many stupid people there are in this world who fall for scams from Nigeria, the UK, Liberia, Somalia, etc. If you were smart enough to buy a computer, how come you are not smart enough to delete scam messages in your e-mail box? Or does everybody believe that they can become a Bernie Madoff or Gordon Gecko just by breathing air. I have had a personal computer, at all times, since the early 1970's, have received thousands of scam messages over the Internet and never, ever, thougth that any one was worth following. I guess idiots abound. Did they vote their conscience and voted for the Tea Party?
Now, there is a scam!

November 09 2012 at 4:31 PM Report abuse rate up rate down Reply
Hello Raymond

Oh, no! Now I will be getting messages saying that I have a share of this settlement and that I need to submit a $85 fee to collect my massive MoneyGram settlement payment. Something needs to be done to track down the international thieves who perpetrate these frauds and to imprison them or otherwise punish them. I wonder how Sharia law views such dishonest actions.

November 09 2012 at 2:55 PM Report abuse rate up rate down Reply