On Friday (Feb. 10), the FTC announced its plans to reimburse consumers for over $115 million due to MoneyGram’s breach of a 2009 settlement and 2012 agreement with the Department of Justice, which they vowed to protect customers from scammers that utilized their payment system. This action was taken following an investigation by both the FTC and DOJ into Moneygram’s failure on this front.
FTC MoneyGram Was Aware of Persistent Fraud
In 2009, the FTC and MoneyGram made an agreement in which MoneyGram would create a fraud prevention program to promptly investigate, restrict, suspend, and terminate agents with high-fraud cases. However, according to the release from the FTC today – even after this settlement was established – MoneyGram neglected numerous suspicious acts of payment activity by their own agents for years. It seems clear that no real attempt was made on their behalf of them to uphold their part of this bargain set out almost a decade ago.
MoneyGram has invested a monumental amount of over $800 million in compliance over the past decade, and it is clearly paying off. According to MoneyGram’s latest statement provided to PYMNTS, reports of consumer fraud complaints have been consistently decreasing for eight years now, reaching an all-time low percentage rate of 0.009% out of more than 100 million money transfers processed by the company this year alone! It’s clear that MoneyGram puts customer safety first when handling their transactions.
Persons Aged 18 to 56 Are 3 Times More Exposed to Fraud
Although most victims, in this case, were seniors, age is not always a determining factor when it comes to becoming a victim of fraud, according to a PYMNTS report last year. This was highlighted by the FTC’s Consumer Protection Data Spotlight.
According to research, adults between 18 and 59 were approximately 34% more likely than their elderly counterparts to report they had been defrauded of money. This runs contrary to the popular belief that cyber criminals usually target seniors. It appears as though wisdom comes with age – older Americans seem less susceptible to online scams due to most likely being exposed to deceptive practices while growing up. As reported by PYMNTS in December, this indicates that experience can be a great teacher when it comes to avoiding fraud on the internet!
The FTC uncovered that people aged 18-59 were 330% more likely to be taken advantage of with false cryptocurrency investment offers and 86% more prone to falling for bogus online deals. These scams usually start on social media platforms when victims are tricked into buying items they’re never sent.
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