Media contact: Janet C. Hart, APR, CFEE (704) 927-8617 office
MoneyGram
Agrees to Pay $18 Million to Settle Fraud Charges
CHARLOTTE, N.C. – Over the past few years, the BBB has
repeatedly warned consumers not to wire
money for any reason to anyone they do not know. According to the Better
Business Bureau, the most successful scam tactic in history involves using fake
checks and wire transfers in combination for a variety of different scams
including foreign lotteries, mystery shoppers, work at home, advance fee loans
and investments.
The majority of these transactions involve wire transfers
via MoneyGram, which is the second largest money transfer system in the United
States. “MoneyGram is the scammers preferred payment method,” said BBB
President Tom Bartholomy. “When someone wires money, that money could be going
to anyone - anywhere in the world, and once the wire transfer is sent, it
cannot be cancelled.”
The Federal Trade Commission (FTC) has been investigating MoneyGram’s
role in fraudulent activity and recently announced that MoneyGram has agreed to
pay $18 million dollars to settle fraud charges with the FTC.
Between 2004 and 2008, the FTC charged that MoneyGram
agents helped fraudulent telemarketers and other con artists trick U.S.
consumers into wiring more than $84 million within the United States and to
Canada – after these consumers were falsely told they had won a lottery, were
hired for a secret shopper program, or were guaranteed loans. The $84 million in
losses is based on consumer complaints to MoneyGram – actual consumer losses
likely are much higher.
Link to FTC News
Release on MoneyGram Settlement: http://ftc.gov/opa/2009/10/moneygram.shtm
The BBB in Charlotte receives telephone calls every day
from consumers who have received checks in the mail with instructions about
depositing the checks and wiring money for whatever the popular scam of the
month involves. “These checks look so real that consumers will actually argue
with our staff about whether the check is real,” said BBB President Tom
Bartholomy. “We tell consumers repeatedly that these checks are fake and the
consumers don’t want to believe us because they want to cash the check.”
The BBB in Charlotte has a file drawer full of hundreds of
fake checks that have been sent to us by local consumers who received them.
“These checks are only a handful of the millions of fake checks that are sent
to consumers each year,” Bartholomy added.
Here is
how some of the most successful fake check/wire transfer scams work:
Foreign
Lotteries – You receive a letter notifying you that you
have won a lottery. The letter contains
a check for an amount that is usually under $5,000. The letter explains that this
check is for the taxes and fees you have to pay to receive your lottery
winnings. It instructs you to deposit
the check and wire the money for the fees via MoneyGram to someone in another
country – Nigeria or Canada usually. So, you deposit the check and wire the
money. Then, a week later, your bank notifies you that the check was
counterfeit. You are out the money you
wired and you are liable for the amount of the check you deposited in your
bank.
Mystery
Shoppers – You see an advertisement online for mystery shoppers and
you apply. Thrilled to be accepted, you receive your first assignment in the
mail. The letter comes with a check that
is usually for less than $3,000. You are
instructed to deposit that check, spend it to “test” the services of three
businesses and then write up a report about your experiences. As a “mystery shopper,” you are instructed to
spend $20 at Burger King, $100 at Wal-Mart and send $2,500 via MoneyGram. The
remaining few hundred dollars is your fee for your secret shopper work. Thinking this is the greatest part-time job
ever, you eagerly fulfill your duties. The only problem is that a few days
later, your bank notifies you that the check was counterfeit. You are now out the money you wired and are
liable to the bank for the check you deposited.
Work at
Home Jobs - You see an advertisement that says “make
full-time money working part-time from home.” This type of jobs sounds ideal
for you. You apply and amazingly, are
hired immediately. Your work at home job
involves processing checks. You are instructed that you will be sent bundles of
checks which you will deposit into your account and then you will wire the
total amount less a few hundred dollars for your “pay” to someone in another
country. Little do you realize that you
are now involved in an international, money laundering, fake check scheme! In a few days, those checks will be returned
by your bank as counterfeit and you will be out the money you wired and the
money you deposited. You could also face
federal charges for money laundering.
The
bottom line from the Better Business Bureau is – Never wire money to anyone
that you do not know for any reason.
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