Almost 40,000 Who Paid Scammers via MoneyGram Will Get Refunds

All of the scam victims will be made whole, FTC says

Close-up of logo on MoneyGram money transfer kiosk in a retail setting, San Ramon, California, March 26, 2019.

Smith Collection/Gado / Getty Images

People who transferred funds to con artists via MoneyGram are getting something that every scam victim wants, but few people ever receive: their money back. 

The Federal Trade Commission is paying $115 million to 38,889 people who sent money to scammers using MoneyGram (MGI) between 2013 and 2017, the commission said Friday. The money comes from a $125 million payment the wire transfer company made to the government to settle a 2018 accusation from the FTC that it wasn’t doing enough to stop people from sending money to scammers over its network. All of the victims are getting full refunds, the FTC said.

“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, in a press release. “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 FTC’s case against MoneyGram goes back to 2009, when regulators ordered the Dallas-based company to take steps to prevent fraudulent transfers. Wire services are popular with scammers because wire transactions, once processed, are usually impossible to reverse, the FTC says. The FTC, a government agency charged with consumer protection, has pushed companies to do more to prevent fraudulent transactions. The FTC has also gotten compensation for scam victims who paid via Western Union (WU); and is similarly suing Walmart (WMT), seeking to make them reimburse fraud victims. 

Wire transfer was the fifth-most common payment method among scams reported to the FTC in 2021, the most recent year for which full statistics are available. More than 60,000 people paid scammers $483 million via wire that year. 

MoneyGram said in an email that it has spent more than $800 million on complying with regulations over the last 10 years and that fraud on its network has steadily declined. Less than one out of every 10,000 transactions processed were the subject of fraud complaints in 2022, the company said.

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  1. Federal Trade Commission. "More than $115 Million in Refunds Sent to Consumers as a Result of FTC, DOJ Charges That MoneyGram Failed to Crack Down on Scams."

  2. Federal Trade Commission. "Before You Wire Money."

  3. Federal Trade Commission. "Did you use Western Union to pay a scammer?"

  4. Federal Tarde Commission. "FTC says Walmart allowed fraud involving money transfers."

  5. Federal Trade Commission. "Fraud Reports." Select "Losses and contact methods" tab, then select the "Payment method" radio button." Select 2021 from the drop-down menu.

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