The Consumer Financial Protection Bureau (CFPB) and New York Attorney General Letitia James sued MoneyGram, one of the largest remittance providers in the US, for systematically and repeatedly violating various laws of consumer financial protection and leaving families stranded waiting for their money by not promptly delivering funds to recipients abroad.
“MoneyGram spent years failing its customers and without follow the law, ignoring customer complaints and government warnings in the process,” CFPB Director Rohit Chopra said. “MoneyGram’s long pattern of misconduct must stop.”
“Our immigrant communities trusted MoneyGram to send their hard-earned money to their loved ones, but MoneyGram let them down,” Attorney General Letitia James said. “Consumers deserve to know where their money went. Businesses have an obligation to be transparent with consumers, treat them fairly and follow the law, but MoneyGram repeatedly failed to do so. Today we are suing MoneyGram to correct its illegal practices and prevent them from harming consumers.”
The CFPB notes that MoneyGram is no stranger to financial crimes and has violated law enforcement orders on multiple occasions with multiple government agencies.
The CFPB and the NY Attorney General charge that MoneyGram:
– Left customers stranded waiting for their money
Customers paid MoneyGram to send money as quickly as possible, but MoneyGram failed to do so and instead held the funds unnecessarily. Keeping the money in limbo resulted in unnecessary delays and hurt the people who depended on that money to pay for necessary living expenses. In addition, the company repeatedly failed to disclose precisely how long it would take to make the funds available to recipients abroad.
– Issued unsuccessful instructions to its employees about how to resolve disputes
The company did not instruct or direct its employees on how to comply with the laws on dispute resolution. The company also failed to report the results of its error investigations to consumers and did not provide a written explanation of its findings to consumers.
– Accused of carelessness in the development and documentation of policies and procedures
MoneyGram did not implement policies and procedures designed to ensure compliance with money transfer laws. Nor did it withhold evidence of its compliance with certain required error resolution requirements.
The lawsuit from both institutions seeks monetary compensation for harmed consumers, an injunction to stop future violations, and the imposition of fines. civil monetary.
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