MoneyGram Hit With $250K Fine for Ripping Off Customers

NEW YORK – MoneyGram International, Inc. and MoneyGram Payment Systems, Inc. (MoneyGram) are $250,000 poorer today after New York Attorney General Letitia James came down hard on the international money transfer giant. The company was found to have repeatedly violated consumer protection laws, putting the hard-earned cash of its customers at risk.

The AG’s office alleges that MoneyGram, a company servicing hundreds of thousands of U.S. clients annually, failed to deliver funds promptly and process refunds in a timely manner. The problems, according to the April 2022 lawsuit filed jointly with the Consumer Financial Protection Bureau (CFPB), weren’t isolated incidents. MoneyGram allegedly ignored its legal obligations to swiftly and accurately investigate reported errors. While the CFPB later bowed out of the case, Attorney General James pressed on, securing a settlement that demands the $250,000 penalty and full compliance with all relevant consumer protection laws.

“New Yorkers who want to send money to their loved ones abroad deserve to be able to trust that the companies handling their hard-earned money operate with honesty,” stated Attorney General James. “MoneyGram broke the law for years, sometimes leaving customers in the dark about the fate of their money. My office has reined in MoneyGram’s illegal conduct and will continue to protect those who rely on MoneyGram to support their families.”

MoneyGram facilitates remittances – money sent from the U.S. to over 200 countries and territories – through a vast network of 440,000 agent locations worldwide and digital platforms. Hundreds of thousands of New Yorkers rely on the service for millions of transactions each year. The Attorney General’s Office (OAG) and CFPB’s initial complaint detailed years of alleged failures: delayed fund availability, slow error resolution, and inaccurate information provided to customers – all clear violations of the law.

Despite the CFPB’s withdrawal, the agreement reached with the OAG ensures MoneyGram is held accountable for its actions impacting New Yorkers. The settlement mandates timely fund transfers and refund processing, accurate consumer information, and prompt error investigations. MoneyGram is also prohibited from providing misleading information to remitters or disclaiming responsibility for errors. Beyond legal compliance, the company must pay the $250,000 fine.

The case was handled by Assistant Attorneys General Laura C. Dismore and Christopher McCall, and former Deputy Attorney General Jason Meizlish, of the Office of Consumer Frauds. The Office of Consumer Frauds is led by Chief of Bureau Jane Azia and Deputy Chief of Bureau Laura Levine, and is part of the Division of Economic Justice, supervised by Principal Deputy Attorney General Chris D’Angelo and First Deputy Attorney General Jennifer Levy.