Walmart fined NT$10 million for money transfer service that became a fraud channel for criminals
Fraudsters used Walmart’s “remittance service” to defraud consumers of hundreds of millions of dollars; after years of investigation, the Federal Trade Commission (FTC) believed that Walmart should bear joint liability and fined it tens of millions of dollars. Walmart has agreed to pay the fine.
The Capitol Hill reported on the 24th that the FTC accused Walmart of failing to take anti-fraud measures, including failing to provide employees with complete anti-fraud training and failing to adequately warn customers of the risks of using remittance platforms.
The FTC pointed out that from 2013 to 2018, Walmart’s remittance service and its cooperation with remittance platforms such as MoneyGram, Western Union and Ria were exploited by criminals due to the above defects.
The Federal Trade Commission filed a lawsuit against Walmart in June 2022, and the following year added the charge of “violating wire transfer sales regulations” to the lawsuit, but the latter was dismissed by the federal district court in July 2024.
In November 2024, the Seventh Circuit Court of Appeals allowed Walmart to appeal the district court’s ruling on facilitating fraud.
The Trade Commission finally ruled with a 3-0 vote that Wal-Mart must do the following four things to prevent criminals from using its remittance service to commit fraud again:
- Do not provide wire transfer services before implementing detection and prevention measures;
- Do not make a remittance if you know or deliberately do not want to know that the money that the customer is about to remit may be related to fraud;
- Do not support telemarketers who use cash payments;
- Do not support telemarketers who require customers who apply for loans or credit to pay in advance.
Christopher Mufarrige, director of the FTC’s Consumer Protection Bureau, said that the favorite remittance method of fraud groups is wire transfer because “once it is remitted, it will never go back.” Therefore, “businesses that provide wire transfer services must train their employees to comply with the law and strive to protect customers.”
The Trade Commission’s responsibility is to promote competition, protect and educate consumers, and will never ask people for money, threaten people, ask people to remit money to it, or say that you have won a prize and come to collect it quickly. It accepts reports from the public about scams or bad manufacturers, and often posts related information on social media to remind the public not to be deceived.
