MoneyGram International Inc. agreed to pay $125 million in penalties to the United States Justice Department for failing to comply with the terms set by the 2012 settlement relating to the company's money laundering and wire fraud violations. Besides the monetary fee, the Dallas-based money transfer company will have to enhance its anti-fraud and anti-money laundering (AML) compliance programs. The corporate monitoring period has also been extended for an additional 30 months.
MoneyGram, which is the second largest provider of money transfers in the world, admitted in 2012 it was involved in consumer fraud schemes perpetrated by corrupt employees and others. The perpetrators usually targeted the elderly and other vulnerable groups, offering them large cash prizes or posing as relatives in need of money. They then required the victims to send them money through MoneyGram.
According to the documents filed in the federal court in Pennsylvania, the money transfer company failed to disclose the weaknesses of its AML and anti-fraud programs to the government, as well as to upgrade them, leading to at least $125 in additional consumer fraud transactions in 2015 and 2016.
