IN THE UNITED STATES
DISTRICT COURT 
FOR THE MIDDLE DISTRICT OF PENNSYLVANIA

	 	)	
	FEDERAL
      TRADE COMMISSION,	)	
		)	
	Plaintiff,	)	
		)	             Civil
      Action No.
	                 v.	)	
		)	
	THE WESTERN
      UNION COMPANY,	)	
	a
      corporation, also doing business as	)	
	Western
      Union Financial Services, Inc.,	)	
	and through
      other subsidiaries and affiliates,  	)	
		)	
	Defendant.	)	
	 	)	



STIPULATED ORDER FOR
PERMANENT INJUNCTION
AND FINAL JUDGMENT

Plaintiff, the Federal Trade
Commission (“Commission” or “FTC”), filed its Complaint for Permanent Injunctive
and Other Equitable Relief (“Complaint”), pursuant to Section 13(b) of the
Federal Trade Commission Act (“FTC Act”), 15 U.S.C. § 53(b), and the
Telemarketing and Consumer Fraud and Abuse Prevention Act (“Telemarketing Act”),
15 U.S.C. §§ 6101-6108.
The Commission and Defendant The
Western Union Company (“Western Union”) stipulate to the entry of this
Stipulated Order for Permanent Injunction and Final Judgment (“Order”) to
resolve all matters in dispute in this action between them. 

1








THEREFORE, IT IS ORDERED as
follows: 

FINDINGS

1. This Court has jurisdiction over this matter. 

2. The Complaint charges
Defendant with engaging in deceptive and unfair acts or practices in violation
of Section 5 of the FTC Act, 15 U.S.C. § 45, the Telemarketing Act, 15 U.S.C. §§
6101-6108, and the Telemarketing Sales Rule (“TSR”), 16 C.F.R. Part 310, in the
course of providing money transfer services through its worldwide money transfer
network. 

3. Defendant neither admits
nor denies any of the allegations in the Complaint, except as specifically stated in this Order. Only for purposes
of this action, Defendant admits the
facts necessary to establish jurisdiction. 

4. Defendant waives any claim
that it may have under the Equal Access to Justice Act, 28 U.S.C. § 2412,
concerning the prosecution of this action through the date of this Order, and
agrees to bear its own costs and attorney fees. 

5. Defendant and the
Commission waive all rights to appeal or otherwise challenge or contest the
validity of this Order. 

DEFINITIONS


For purposes of this Order,
the following definitions apply: 

A. “Cash-to-cash money transfer” means the transfer of the value of cash from one
person in one location to a recipient (payee) in another location that is
received in the form of cash. 

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B. “Cash reload money transfer” means the transfer of the value of cash from one
person in one location to a recipient (payee) in another location that is
received in a form that makes it possible for a person to convert the cash into
an electronic form that can be used to add funds to a general-use prepaid card
or an account with a payment intermediary. 

C. “Consumer” means any person, worldwide, who initiates or sends a money transfer. 

D. “Defendant” means The Western Union Company, also doing
business as Western Union Financial Services, Inc., and through its other
subsidiaries and affiliates, and its successors and assigns. 

E. “Elevated fraud countries” means any country in which the principal amount of
money transfers that are the subject of fraud complaints, received by Defendant
from any source, represents one (1) percent or more of the principal amount of
fraud complaints worldwide received by Defendant, for either money transfers
sent or received in that country, determined on a quarterly basis,
provided that once a country is determined to be one of the
elevated fraud countries, it shall continue to be treated as such for purposes
of this Order. 


3







F. “Elevated fraud risk agent location”
means any Western Union agent
location that has processed payouts of money transfers associated with:


		1.	Five (5)
      or more fraud complaints for such agent location, received by Defendant
      from any source, during the previous sixty (60) day period, based on a
      review of complaints on a monthly basis; and fraud complaints, received by
      Defendant from any source, totaling five (5) percent or more of the total
      payouts for such agent location in numbers or dollars in a sixty (60) day
      period, calculated on a monthly basis; or
	     	       	
		2.	Fifteen
      (15) or more fraud complaints for such agent location, received by
      Defendant from any source, during the previous sixty (60) day period,
      based on a review of complaints on a monthly
basis.


G. “Fraud-induced money transfer” includes any money transfer that was induced by,
initiated, or sent as a result of, unfair or deceptive acts or practices and/or
deceptive or abusive telemarketing acts or practices. 

H. “Front line associate” means the employee of the Western Union agent
responsible for handling a transaction at the point of sale for a consumer or a
recipient (payee) of a money transfer, including by initiating, sending, or
paying out the money transfer. 

I. “Money transfer” means the sending of money (in cash or any other
form, unless otherwise stated) between a consumer in one location to a recipient
(payee) in another location using Defendant’s money transfer service, and shall
include transfers initiated or sent in person, online, over the telephone, using
a mobile app, or through whatever platform or means made available. The term
“money transfer” does not include Defendant’s bill or loan payment services, or
purchases of foreign currency conversions or options contracts from
Defendant. 

4







J. “Person” includes a natural person, an organization or other legal entity,
including a corporation, partnership, sole proprietorship, limited liability
company, association, cooperative, or any other group or combination acting as
an entity. 



K. “Seller”
means any person who, in
connection with a telemarketing transaction, provides, offers to provide, or
arranges for others to provide goods or services in exchange for consideration.


L. “Telemarketer” means any person who, in connection with
telemarketing, initiates or receives
telephone calls to or from a customer. 

M. “Telemarketing” means any plan, program, or campaign which is
conducted to induce the purchase of goods or services by use of one or more
telephones, and which involves a telephone call, whether or not covered by the
TSR.

N. “Western Union agent” means any network agent, master agent,
representative, authorized delegate, independent agent, super-agent, national
account agent, key account agent, strategic account agent, sub-representative,
subagent, or any location, worldwide, authorized by Defendant to offer or
provide any of its money transfer products or services. 

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I.

PROHIBITED BUSINESS
ACTIVITIES

IT IS FURTHER ORDERED that
Defendant, Defendant’s officers, agents, and employees, and all other persons in
active concert or participation with any of them, who receive actual notice of
this Order, whether acting directly or indirectly, in connection with promoting,
offering for sale, or providing money transfer services, are permanently
restrained and enjoined from: 

	A.	Transmitting a money transfer that Defendant knows or reasonably
      should know is a fraud-induced money transfer, or paying out a money
      transfer to any person that Defendant knows or reasonably should know is
      using its system to obtain funds from a consumer, directly or indirectly,
      as a result of fraud;
	        	
	B.	Providing
      substantial assistance or support to any seller or telemarketer that
      Defendant knows or reasonably should know is accepting from a U.S.
      consumer, directly or indirectly, a money transfer as payment for goods or
      services offered or sold through telemarketing;
	 


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	C.	Failing to
      do any of the following in connection with money transfers initiated by
      consumers:
	        	 



		1.	Interdict recipients that have been the subject of any complaints
      about fraud-induced money transfers based on information provided to, or
      that becomes known by, Defendant;
	        	        	
		2.	Identify, prevent, and stop cash-to-cash money transfers and cash
      reload money transfers initiated or received in the U.S. from being used
      as a form of payment by sellers or telemarketers, including, but not
      limited to, by:
		 
			a.	Asking all
      U.S. consumers whether the money transfer is a payment for goods or
      services offered or sold through telemarketing;
			        	
			b.	Declining
      to process money transfers from U.S. consumers where the money transfer is
      a payment for goods or services offered or sold through telemarketing;
      and
		 
			c.	Interdicting known sellers and telemarketers accepting money
      transfers as payments for goods or services offered through
      telemarketing;


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		3.	Provide a
      clear, concise, conspicuous and uncontradicted consumer fraud warning on
      the front page of all money transfer forms, paper or electronic, utilized
      by consumers in elevated fraud countries (based on money transfers sent
      from those countries) to initiate money transfers using Defendant’s system
      that includes, but is not limited to:
		 		
	        		a.	A list of
      the most common types of scams that utilize Defendant’s money transfer
      system;
		        	        	
			b.	A warning
      that it is illegal for any seller or telemarketer to accept payments from
      U.S. consumers through money transfers for goods or services offered or
      sold through telemarketing;
		 
			c.	A notice
      to consumers that the money transfer can be paid out to the recipient
      within a short time, and that after the money is paid out, consumers may
      not be able to obtain a refund from Defendant, even if the transfer was
      the result of fraud, except under limited circumstances; and
		 
			d.	A
      toll-free or local number and a website for Defendant, subject to the
      timing requirements set forth in Subsection C.4, that consumers may call
      or visit to obtain assistance and file a complaint if their money transfer
      was procured through fraud;
		 
		4.	Make available in all countries in which Defendant offers money
      transfer services a website that consumers may visit to obtain assistance
      and file a complaint if they claim their money transfer was procured
      through fraud, provided that
      websites that are not yet
      available shall be made available in accordance with the following
      schedule: (i) for countries determined to be elevated fraud countries,
      within six (6) months of entry of this Order; and (ii) for all other
      countries, within two (2) years of entry of this Order.
  


8







	        	5.	Provide
      consumers who initiate or send money transfers via the Internet,
      telephone, mobile app, or any other platform that is not in- person, with
      substantially the same clear, concise, conspicuous and uncontradicted
      fraud warning required by Subsection C.3, provided that the warning may be abbreviated to
      accommodate the specific characteristics of the media or
    platform;
		       	
		6.	Provide
      the required warning to consumers in the language used on the send form or
      other media type or platform used for the money transfer, in a form
      appropriate for the media or platform;
		 
		7.	Review and
      update the consumer warning as necessary to ensure its effectiveness in
      preventing fraud-induced money transfers; and
		 
		8.	Submit
      modifications to the warning, if any, to the Commission for review no less
      than ten (10) business days before any modified warning is disseminated to
      Western Union agents; provided that nothing
      herein shall prohibit Defendant from changing the nature or form of its
      service, send forms, or media or platform for offering money transfer
      services or from seeking to replace its send forms with an electronic form
      or entry system of some type in the future. In the event such changes are
      made, Defendant shall provide a consumer fraud warning substantially
      similar to that outlined in Subsection C.3 in a form appropriate to the
      media or platform;


9







	D.	Failing to reimburse the principal amount of a consumer’s money
      transfer and any associated transfer fees whenever a consumer or his or
      her authorized representative reasonably claims that the transfer was
      fraudulently induced and:
	        	
		1.	The
      consumer or his or her authorized representative asks Defendant, the
      sending agent, or front line associates to reverse the transfer before the
      transferred funds have been picked up; or
		        	
		2.	Defendant, after reviewing information and data relating to the
      money transfer, determines that Defendant, its agents, or the front line
      associates failed to comply with any of Defendant’s policies and
      procedures relating to detecting and preventing fraud-induced money
      transfers when sending or paying out the money transfer by failing to:
      provide the required consumer fraud warnings; comply with Defendant’s
      interdiction or callback programs; verify the
  recipient’s identification; or
      accurately record the recipient’s identification(s) and other required
      biographical data; 









	E.	Failing to promptly
      provide information to a consumer, or his or her authorized
      representative, who reports being a victim of fraud to Defendant, about
      the name of the recipient of the consumer’s money transfer and the
      location where it was paid out, when such information is reasonably
      requested; and
	        	
	F.	Failing to establish
      and implement, and thereafter maintain, a comprehensive anti-fraud program
      that is reasonably designed to protect consumers by detecting and
      preventing fraud-induced money transfers worldwide and to avoid installing
      and doing business with Western Union agents who appear to be involved or
      complicit in processing fraud-induced money transfers or fail to comply
      with Defendant’s policies and procedures to detect and prevent fraud
      (hereinafter referred to as “Defendant’s Anti-Fraud Program”). Such
      program, the content and implementation of which must be fully documented
      in writing, and provided to the FTC, shall contain administrative,
      technical, and physical safeguards appropriate to Defendant’s size and
      complexity and the nature and scope of Defendant’s activities, shall be
      consistent with this Order’s requirements, and shall include at least the
      following requirements:



	        	        	
		1.	Performance
      of due diligence on all prospective Western Union agents and existing
      Western Union agents whose contracts are up for renewal;


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		2.	Designation
      of an employee or employees to coordinate and be accountable for
      Defendant’s Anti-Fraud Program;
	        	        	
		3.	Appropriate
      and adequate education and training on consumer fraud for Western Union
      agents and front line associates;
		 
		4.	Appropriate
      and adequate monitoring of Western Union agent and front line associate
      activity relevant to the prevention of fraud-induced money
      transfers;
		 
		5.	Prompt
      disciplinary action against Western Union agent locations where reasonably
      necessary to prevent fraud-induced money transfers;
		 
		6.	Adequate
      systematic controls to detect and prevent fraud-induced money transfers,
      including, but not limited to:
			        	
			a.	Imposing more
      stringent identification requirements for money transfers sent to, or paid
      out in, elevated fraud countries;
		 
			b.	Holding suspicious
      money transfers at certain dollar thresholds to elevated fraud countries
      until Defendant has confirmed with the sender that they are not
      fraud-induced or has refunded the money to the sender;
  and
		 
			c.	Ensuring that Western
      Union agent locations are recording all required information about
      recipients required by Defendant’s policies or procedures or by law,
      including, but not limited to, their names, addresses, telephone numbers,
      and identifications, before paying out money transfers; and


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	        	7.	Periodic
      evaluation and adjustment of Defendant’s Anti-Fraud Program in light
      of:
	 	        	        	
	 		a.	The results of the
      monitoring required by Subsection F.4 of this Section and Section III of
      this Order;
	 	 
	 		b.	Any material changes
      to Defendant’s operations or business arrangements; or
	 	 
	 		c.	Any other
      circumstances that Defendant knows or reasonably should know may have a
      material impact on the effectiveness of Defendant’s Anti-Fraud Program,
      provided that
      Defendant shall notify the
      FTC in writing of the adjustments to Defendant’s Anti-Fraud Program, and
      reasons for such adjustments, no more than thirty (30) days after any
      material modification to Defendant’s Anti-Fraud Program has been
      implemented.


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II.

DUE DILIGENCE ON
PROSPECTIVE AND EXISTING
WESTERN UNION AGENTS

IT IS FURTHER ORDERED that
Defendant, Defendant’s officers, agents, and employees, and all other persons in
active concert or participation with any of them, who receive actual notice of
this Order, whether acting directly or indirectly, in connection with promoting,
offering for sale, or providing money transfer services, are hereby restrained
and enjoined from: 

	A.	Failing to
      conduct thorough due diligence on all persons applying to become, or
      renewing their contracts as, Western Union agents, including any
      sub-representative or subagent, to avoid installing Western Union agents
      worldwide who may become elevated fraud risk agent locations, including,
      but not limited to, by:
	        	        	
		1.	Verifying
      government-issued identification;
	 
		2.	Conducting all
      reasonably necessary background checks (criminal, employment, or
      otherwise) where permissible under local law;
	 
		3.	Determining whether
      information or statements made during the agent application process are
      false or inconsistent with the results of Defendant’s background checks or
      other due diligence;
	 
		4.	Taking reasonable
      steps to ascertain whether the prospective agent formerly owned, operated,
      had been a front line associate of, or had a familial, beneficial, or
      straw relationship with any location of any money services business that
      was suspended or terminated for fraud-related reasons, as permitted by
      applicable laws and regulations (including foreign laws and regulations)
      and with the required cooperation from other money transfer companies;
      


13







		5.	Ascertaining whether
      the prospective agent had previously been interdicted by Defendant for
      suspicious activities or had been reported to Defendant as a recipient of
      fraud-induced money transfers;
		 
		6.	Conducting an
      individualized assessment of the particular risk factors involved with
      each Western Union agent application and conducting all reasonably
      necessary investigative steps consistent with those risks;
and
		 
		7.	Maintaining
      information about Defendant’s due diligence, including, but not limited
      to, information about the identities of the owners, their
      government-issued identifications, and the background check(s)
      conducted;
	        	        	
	B.	Failing to reject applications where
      Defendant becomes aware or reasonably should have become aware based upon
      its due diligence that the applicant, or any of the applicant’s
      sub-representatives or subagents, presents a material risk of becoming an
      elevated fraud risk;





	C.	Failing to ensure
      that the written agreements entered into with all new Western Union agents
      require them to comply with Section I.C.2 of this Order;
	        	
	D.	Failing to ensure
      that all new Western Union agents have effective policies and procedures
      in place at each of the agent’s locations to detect and prevent
      fraud-induced money transfers and other acts or practices that violate
      Section I of this Order;
		 
	E.	Failing to take
      reasonable steps to confirm that Western Union agents whose contracts are
      up for renewal are complying with the terms of their agreements with
      Defendant, including, but not limited to, by having effective policies and
      procedures in place to detect and prevent fraud- induced money transfers;
      and
	 
	F.	Failing to require
      all new Western Union agents, and existing Western Union agents, to: (i)
      disclose and update the identities of any sub- representative or subagent;
      and (ii) maintain records on the identities of any front line associates
      at their sub-representatives’ or subagents’
locations.



14







III.

MONITORING COMPLIANCE
OF WESTERN UNION AGENTS

IT IS FURTHER ORDERED that
Defendant, Defendant’s officers, agents, and employees, and all other persons in
active concert or participation with any of them, who receive actual notice of
this Order, whether acting directly or indirectly, in connection with promoting,
offering for sale, or providing money transfer services, are hereby restrained
and enjoined from: 

	A.	Failing to provide
      appropriate and adequate ongoing education and training on consumer fraud
      for all Western Union agents, and other appropriate Western Union
      personnel, including, but not limited to, education and training on
      detecting, investigating, preventing, reporting, and otherwise handling
      suspicious transactions and fraud-induced money transfers, and ensuring
      that all Western Union agents and front line associates are notified of
      their obligations to comply with Defendant’s policies and procedures and
      to implement and maintain policies and procedures to detect and prevent
      fraud-induced money transfers or other acts or practices that violate
      Section I of this Order;
	        	


	B.	
      Failing to take all reasonable
      steps necessary to monitor and investigate Western Union agent location
      activity to detect and prevent fraud-induced money transfers, including,
      but not limited to: 

	        	        	 
		1.	
      Developing, implementing,
      adequately staffing, and continuously operating and maintaining a system
      to receive and retain all complaints and data received from any source,
      anywhere in the world, involving alleged fraud-induced money transfers,
      and taking all reasonable steps to obtain, record, retain, and make easily
      accessible to Defendant and, upon reasonable request, the FTC, all
      relevant information regarding all complaints related to alleged
      fraud-induced money transfers, including, but not limited
  to:

			        	  
			a.	The
      consumer’s name, address, and telephone number;
			 
			b.	The
      substance of the complaint, including the fraud type and fraud method, and
      the name of any person referenced;


15







			c.	The
      reference number, or Money Transfer Control Number, for each money
      transfer related to the complaint;
	        	        	        	
			d.	The name,
      agent identification number, telephone number, and address of the sending
      agent(s);
			 
			e.	The date
      of each money transfer;
			 
			f.	The amount
      of each money transfer;
			 
			g.	The money
      transfer fee for each money transfer;
			 
			h.	The date
      each money transfer is received;
			 
			i.	The name,
      agent identification number, telephone number, and address of the
      receiving agent(s);
			 
			j.	The name,
      address and telephone number of the recipient, as provided by the
      recipient, of each money transfer;


16







			k.	The identification,
      if any, presented by the recipient, and recorded, for each money
      transfer;
			 
			l.	All transactions
      conducted by the consumer bearing any relationship to the
    complaint;
			 
			m.	To the extent there
      is any investigation concerning, and/or resolution of, the
      complaint:
	        	        	        	        	
				1.	The nature and result of any investigation
      conducted concerning the complaint;
			 
				2.	Any response to the complaint and the date
      of such response to the complaint;
			 
				3.	The final resolution of the complaint, the
      date of such resolution, and an explanation for the resolution;
    and
			 
				4.	If the resolution does not include the
      issuance of a refund, the reason for the denial of a refund;
			 


		2.	Taking all reasonable
      steps to identify Western Union agents or front line associates involved
      or complicit in fraud;
		 
		3.	Routinely reviewing
      and analyzing data regarding the activities of Western Union agent
      locations in order to identify the following:
	        	        	        	
			a.	
      Agent locations that have processed
      transactions associated with two (2) or more complaints about alleged
      fraud-induced money transfers, received by Defendant from any source,
      during a thirty (30) day period; and 

				 
			b.	
      Elevated fraud risk agent
      locations, as defined above; and



17







		4.	For agent
      locations identified pursuant to Subsection B.3 of this Section, fully
      investigate the agent location by reviewing transaction data and
      conducting analyses to determine if the agent location displayed any
      unusual or suspicious money transfer activity that cannot reasonably be
      explained or justified, including, but not limited to:
	        	        	        	
			a.	Data integrity
      issues, including, but not limited to, invalid, illegible, incomplete,
      missing, or conflicting biographical data for consumers or recipients of
      money transfers;
		 
			b.	Significant changes
      in the transaction patterns experienced at the agent
location;
		 
			c.	Significant
      differences in the transaction patterns experienced at an agent location
      relative to the patterns experienced at other agent locations in the same
      country;
		 
			d.	Unusual demographic
      activity;
		 
			e.	Irregular
      concentrations of send and/or pay activity between the agent and one or
      more other Western Union agent locations;


18










		f.	Irregular
      concentrations of send and/or pay activity between the agent and one or
      more geographical areas that have been identified as high risk for
      fraud;
	                	        	
		g.	Unusual transaction
      patterns by senders or recipients;
		 
		h.	Flipping
      patterns;
		 
		i.	Suspicious
      structuring or splitting of money transfers; or
		 
		j.	Suspicious surfing
      patterns;


	        	
	C.	Failing to take the following actions to
      prevent further fraud-induced money transfers, including, but not limited
      to, by:


	        	        	
		1.	Suspending Western Union agent locations, as
      follows, pending further investigation to determine whether the Western
      Union agent locations can continue operating consistent with this Order’s
      requirements:


	                	        	
		a.	For agent locations
      identified pursuant to Subsection B.3.a of this Section, if the
      investigation of the agent location required by Subsection B.4 of this
      Section is not completed within fourteen (14) days after the agent
      location is identified, suspending the Western Union agent location’s
      ability to conduct further money transfers until the investigation is
      completed; and


19







		b.	For elevated fraud
      risk agent locations, immediately suspending the Western Union agent’s
      ability to conduct further money transfers until the review required by
      Subsection B.4 of this Section is completed, except that, for a Western Union agent that is a bank
      or bank branch and otherwise subject to this immediate suspension
      requirement by virtue of fraud complaints about money transfers that are
      transferred directly into its account holders’ bank accounts, Defendant
      shall comply with Subsection III.C.1.a. and also permanently block, or
      request that the Western Union agent block, all further money transfers to
      bank accounts for which Defendant has received any fraud
    complaint;
	                	        	


		2.	Upon completion of the investigation,
      terminating, suspending, or restricting Western Union agent locations as
      follows:
	        	        	


		a.	Terminating or
      suspending the Western Union agent location, or restricting the agent
      location’s ability to send and/or receive certain money transfers, if the
      findings indicate that the Western Union agent location is not, or has not
      been, complying with Defendant’s Anti-Fraud Program and other policies and
      procedures relating to detecting and preventing fraud-induced money
      transfers, including, but not limited to, by failing to collect and record
      required and accurate biographical information about, and
      government-issued identifications for, the recipients of money transfers;
      and
	                	        	


		b.	Terminating the
      Western Union agent location if the findings indicate that the Western
      Union agent location or any of its front line associates is, or may be,
      complicit in the fraud-induced money transfers, has failed to comply with
      Section IV of this Order, or has repeatedly failed to comply with
      Defendant’s Anti-Fraud and other policies and procedures relating to
      detecting and preventing fraud-induced money transfers;
	                	        	


		3.	On at least a monthly
      basis, providing notice to all Western Union agents in elevated fraud
      countries the substance of any complaints Defendant received involving
      transactions processed by the agents’ locations; and
	        	        	
		4.	Ensuring that all
      Western Union agents are enforcing effective policies and procedures to
      detect and prevent fraud-induced money transfers, or other acts or
      practices that violate Section I of this Order;
and


20







	D.	Failing to establish adequate controls to
      ensure that, prior to paying out money transfers, Western Union agent
      locations are recording all required information about the recipients of
      money transfers, including, but not limited to, the recipients’ names,
      addresses, telephone numbers, and identifications, and are taking
      reasonable steps to verify the identification presented by the recipients
      or, for money transfers that are directed to bank accounts, the identities
      of the account holders.
	        	
	
      IV.



REQUIREMENTS FOR
ELEVATED FRAUD RISK AGENT LOCATIONS 

IT IS FURTHER ORDERED that
Defendant, Defendant’s officers, agents, and employees, and all other persons in
active concert or participation with any of them, who receive actual notice of
this Order, whether acting directly or indirectly, in connection with promoting,
offering for sale, or providing money transfer services, shall require and
ensure that all elevated fraud risk agent locations that are still operating do
the following for one (1) year from the date that Defendant identifies the agent
as an elevated fraud risk agent location under the terms of this Order:


	A.	For money transfers that are not transferred
      directly into a recipient’s bank account, photocopy or scan the
      identification documents or biometric information presented by the
      recipient and retain the photocopies or images, along with the receive
      forms, for a period of five (5) years; and
	        	



      	B.	Demonstrate during compliance reviews or
      mystery shops, which Defendant shall conduct on at least a quarterly
      basis, that the agent location is complying with the requirements in this
      Section;
	       	
	
             Provided,
      however, that if Defendant
      reasonably believes that complying with Subsection A of this Section for money transfers received by
      an elevated fraud agent location in a particular foreign jurisdiction
      would violate that jurisdiction’s laws, Defendant may instead, upon notice
      to Commission staff, block all money transfers from the United States to
      that elevated fraud risk agent location or, with the agreement of
      Commission staff, take other appropriate action at that location to
      protect consumers from fraud. 



      21








V.

SHARING COMPLAINT
INFORMATION

IT IS FURTHER ORDERED that,
Defendant, Defendant’s officers, agents, and employees, and all other persons in
active concert or participation with any of them, who receive actual notice of
this Order, whether acting directly or indirectly, shall, in addition to, or as
a modification of, any other policy or practice that the Defendant may have,
including Defendant’s ongoing submission of information to the FTC for inclusion
in the Consumer Sentinel Network (“Consumer Sentinel”): 




	A.	Provide notice to the
      consumer, or his or her authorized representative, at the time the
      Defendant is contacted with a complaint about alleged fraudulent activity
      associated with a money transfer, that (i) Defendant’s practice is to
      share information regarding the consumer’s money transfer and complaint
      with a database used by law enforcement authorities in the United States
      and other countries; and (ii) if the consumer does not want his or her
      name, address, and identification shared with law enforcement, Defendant
      will honor that request unless applicable law permits or requires
      Defendant to provide that information; and
	        	
	B.	Regularly, but no
      more than every thirty (30) days, submit electronically to the FTC, or its
      designated agent, for inclusion in Consumer Sentinel, all relevant
      information Defendant possesses regarding complaints received from
      consumers, their authorized representatives, or any other source, anywhere
      worldwide, about alleged fraud-induced money transfers and regarding the
      underlying transfer itself, including, but not limited to, the information
      set forth in Section III.B.1.a through III.B.1.l. Provided, however, if
      Defendant receives a request from a consumer or the consumer’s authorized
      representative, which is documented by Defendant, stating that the
      consumer does not want the information shared with the database, or if
      Defendant received the complaint from a source other than the consumer or
      the consumer’s authorized representative, Defendant shall submit to the
      FTC an anonymized complaint with the consumer’s name, address, and
      telephone number redacted. Provided,
      further, that Defendant shall cooperate with the
      FTC in order to facilitate compliance with this Section.
  


22







VI.

INDEPENDENT COMPLIANCE
AUDITOR

IT IS FURTHER ORDERED THAT an
Independent Compliance Auditor (“ICA”) shall be appointed to further ensure
compliance with Sections I-V of this Order, as set forth below: 

	A.	Commission staff and
      Defendant shall select the ICA. The ICA shall be an independent third
      party, not an employee of the Commission or of Defendant. No later than
      thirty (30) days after entry of this Order, Defendant shall propose to a
      representative of the Commission three qualified, third-party candidates
      to serve as the ICA for Defendant as set forth in this Section. In the
      event that Commission staff is unable to select at least one acceptable
      ICA from the three candidates proposed by Defendant, Defendant shall
      propose another candidate within fourteen (14) days after receiving notice
      of the rejection. This process shall continue until an ICA is chosen. If
      within ninety (90) days after entry of this Order, the parties are unable
      to agree on a candidate who is willing and able to perform the ICA’s
      duties under this Order, they shall submit the matter to the Court for
      determination.
	        	 



	B.	The ICA shall review,
      assess, and evaluate Defendant’s compliance with Sections I-V of this
      Order;
	        	
	C.	The ICA is authorized
      to choose, engage, and employ attorneys, investigators, accountants,
      appraisers, and other independent contractors and technical specialists,
      as the ICA deems advisable or necessary in the performance of the ICA’s
      duties and responsibilities under the authority granted by this
      Order;
		 
	D.	The ICA shall have
      immediate, unfettered access to all information, documents, personnel, and
      premises in the possession, custody, or control of Defendant or any
      Western Union agent that the ICA deems necessary to carry out the ICA’s
      duties pursuant to this Order; provided that, the
      ICA shall make reasonable efforts to avoid imposing upon Defendant undue
      costs and burdens; and provided that, if
      there is a dispute about the ICA’s access to Defendant’s or any Western
      Union agents’ information, documents, personnel, and premises, after
      attempting to resolve the dispute without court action and for good cause
      shown, Defendant or the ICA may file a motion with this Court seeking
      appropriate relief;


23







	E.	Defendant shall fully cooperate with and
      assist the ICA. The cooperation and assistance shall include, but not be
      limited to, providing information to the ICA that the ICA deems necessary
      to be fully informed and discharge the responsibilities of the ICA under
      this Order, including proprietary information and trade secrets; providing
      any password required to access any computer, electronic file, or
      telephone data in any medium; and producing Defendant’s financial records.
      The parties agree that no attorney-client or other professional
      relationship shall be formed between the ICA and Defendant;
	        	
	F.	The ICA shall prepare a budget and work plan
      as follows:


	        	        	
		1.	No later than sixty
      (60) days after the date on which the ICA is retained by Defendant, the
      ICA shall, in consultation with Commission staff and Defendant, prepare
      and present to Commission staff and Defendant an annual budget and work
      plan (the “ICA Budget”) describing the scope of work to be performed and
      the fees and expenses of the ICA and any professional staff to be incurred
      during the first year following the date on which the ICA is
      retained.
		 
		2.	The scope of work,
      fees, and expenses to be incurred by the ICA and any professional staff
      shall be reasonable and not excessive, in light of the ICA’s defined
      duties, responsibilities, and powers prescribed in this
  Order.


24







		3.	The ICA shall prepare and submit to
      Defendant and to Commission staff an annual ICA Budget no later than
      ninety (90) days prior to the beginning of each subsequent year of the
      ICA’s term. If Defendant and Commission staff both approve the ICA Budget,
      the ICA shall adhere to and shall not exceed the approved ICA Budget,
      unless such deviations are authorized by agreement of the parties or order
      of the Court.
	        	        	
		4.	Within twenty-one (21) days of receipt of
      any ICA Budget, either Commission staff or Defendant may serve an
      objection to the ICA, who, within twenty-one (21) days of such objection,
      shall provide to Commission staff and Defendant a revised ICA Budget or a
      notice that no such revision will be made.
		 
		5.	Following the ICA’s response to an objection
      provided in accordance with Subsection VI.F.4 hereof, either Commission
      staff or Defendant may apply to the Court to modify the ICA
    Budget.
		 
		6.	Pending the Court’s decision concerning any
      application pursuant to Subsection VI.F.5, the ICA shall continue to
      perform its duties and implement the ICA Budget as prepared by the
      ICA.


25










	G.	Within one
      hundred eighty (180) days from the date of the engagement of the ICA, and
      annually thereafter until the end of the ICA’s term, the ICA shall issue a
      report to Commission staff setting forth the ICA’s assessment of
      Defendant’s compliance with this Order (“Report”). If, at any time, the
      ICA determines that Defendant is not in substantial compliance with this
      Order, the ICA shall notify Commission staff and consult with Defendant.
      Defendant may submit to Commission staff and to the ICA a written response
      to the ICA’s notification;
	        	
	H.	The Report
      and the contents thereof shall be treated as non-public material pursuant
      to the Commission’s Procedures and Rules of Practice. The FTC may share
      the Report and its contents with other law enforcement agencies,
      including, but not limited to, the United States Department of Justice
      (“DOJ”), as permitted by the Commission’s Procedures and Rules of
      Practice;
	 
	I.	The ICA’s
      term shall be three (3) years from the date on which the ICA is retained
      by Defendant. If the ICA resigns or is otherwise unable to fulfill his or
      her obligations as set out in this Section, the process set forth in
      Subsection N of this Section shall govern the selection of a new
      ICA;
	 
	J.	The ICA
      and all personnel hired by the ICA, including counsel to the ICA, are
      entitled to reasonable compensation for the performance of duties pursuant
      to this Order and for the cost of actual out-of-pocket expenses incurred
      by them, from Defendant’s assets. The ICA shall provide Defendant with an
      accounting and a request for payment of reasonable compensation every six
      (6) months after the ICA is appointed, or at intervals deemed appropriate
      by the ICA;


26







	K.	Defendant
      shall indemnify the ICA and hold the ICA harmless against all losses,
      claims, damages, liabilities, or expenses arising out of, or in connection
      with, the performance of the ICA’s duties, including all reasonable fees
      of counsel and other reasonable expenses incurred in connection with the
      preparations for, or defense of, any claim, whether or not resulting in
      any liability, except to the extent that such losses, claims, damages,
      liabilities, or expenses result from gross negligence, willful or wanton
      acts, or bad faith by the ICA;
	        	
	L.	In the
      event the ICA determines that the Defendant has failed to act consistently
      with the terms of this Section, the ICA shall notify the FTC and
      Defendant, and, for good cause shown, the ICA or the FTC may apply to the
      Court for appropriate relief, including for an extension of the ICA’s term
      set forth in Subsection I of this Section;
	 
	M.	The ICA
      may, from time to time as may be made necessary by circumstances outside
      the ICA’s control, such as by reason of the ICA’s temporary incapacity,
      family emergency, or natural disaster, appoint a temporary Acting ICA to
      act in the ICA’s stead. The rights, duties, and obligations of the ICA
      under this Section shall apply equally to any such duly appointed Acting
      ICA, provided, however, that the period during which the ICA’s role is
      filled by an Acting ICA shall not extend for longer than thirty (30)
      days;





	N.	If the ICA
      is no longer willing or able to continue to serve, or if the Court
      relieves the ICA of his duties at the request of the FTC or Defendant,
      Commission staff and Defendant shall mutually agree on a replacement ICA.
      If the parties are unable to agree on a replacement ICA within sixty (60)
      days, they shall submit the matter to the Court for determination within
      ten (10) days thereafter. The overall term of the ICA set forth in
      Subsection I of this Section shall be extended commensurate with the
      length of the absence of the ICA; and
	        	
	O.	In the
      event of the appointment of a replacement ICA, the replacement ICA shall
      have all the rights, powers, duties, and obligations of the ICA under this
      Order.


27







VII.

MONETARY
JUDGMENT

IT IS FURTHER ORDERED THAT:


	A.	Judgment
      in the amount of five hundred eighty-six million dollars ($586,000,000) is
      entered in favor of the Commission against Defendant as equitable monetary
      relief.
	        	
	B.	Defendant
      shall satisfy the judgment in Subsection A of this Section by complying
      with the payment requirements set forth in Paragraph 7 of the Deferred
      Prosecution Agreement filed in United States v. The Western Union Company, 1:17-CR-00011-CCC (M.D. Pa. Jan. 19, 2017)
      (“DPA”).
	 
	C.	Defendant
      relinquishes dominion and all legal and equitable right, title, and
      interest in all assets transferred pursuant to this Order and Paragraphs 7
      and 8 of the DPA and may not seek the return of any assets;
	 
	D.	The facts
      alleged in the Complaint will be taken as true, without further proof, in
      any subsequent civil litigation by or on behalf of the Commission,
      including in a proceeding to enforce its rights to any payment or monetary
      judgment pursuant to this Order, such as a nondischargeability complaint
      in any bankruptcy case;
	 
	E.	The facts
      alleged in the Complaint establish all elements necessary to sustain an
      action by the Commission pursuant to Section 523(a)(2)(A) of the
      Bankruptcy Code, 11 U.S.C. § 523(a)(2)(A), and this Order will have
      collateral estoppel effect for such purposes;


28







	F.	Defendant
      acknowledges that its Employer Identification Number, which Defendant must
      submit to the Commission, may be used for collecting and reporting on any
      delinquent amount arising out of this Order, in accordance with 31 U.S.C.
      § 7701;
	        	
	G.	All money
      paid pursuant to this Order and Paragraph 7 of the DPA shall be deposited
      into the DOJ or the Department of the Treasury Assets Forfeiture Funds.
      The FTC and DOJ intend to make the funds available to compensate the fraud
      victims described in the FTC Complaint and the DOJ Statement of Facts, as
      set forth in Paragraph 7 of the DPA. Defendant has no right to challenge
      any actions taken by DOJ, the FTC, or their representatives, pursuant to
      this Subsection; and
	 
	H.	No asset
      transfer required by this Order should be deemed, or deemed in lieu of, a
      fine, penalty, forfeiture, or punitive assessment. Defendant’s
      satisfaction of the judgment through a payment pursuant to the DPA is not
      intended to alter the remedial nature of the
judgment.


29







VIII.

ORDER
ACKNOWLEDGMENT

IT IS FURTHER ORDERED that
Defendant obtain acknowledgments of receipt of this Order: 

	A.	Defendant,
      within seven (7) days of entry of this Order, must submit to the
      Commission an acknowledgment of receipt of this Order sworn under penalty
      of perjury;
	        	
	B.	For ten
      (10) years after entry of this Order, Defendant must deliver by electronic
      or other means a copy of this Order to: (1) all principals, officers,
      directors, and LLC managers and members; (2) all employees, agents, and
      representatives who participate in conduct related to the subject matter
      of this Order, including, but not limited to, Western Union agents and
      employees who are involved in any way with consumer fraud complaints or
      who are involved in the hiring, training or monitoring of Western Union
      agents; and (3) any business entity resulting from any change in structure
      as set forth in the Section titled Compliance Reporting. Defendant must
      send a copy of this Order to current personnel within seven (7) days of
      entry of this Order. For all others, delivery must occur before they
      assume their responsibilities; and



	C.	From each
      individual or entity to which a Defendant delivered a copy of this Order,
      that Defendant must obtain, within thirty (30) days, a signed and dated
      acknowledgment of receipt of this Order. Provided that, in the event that Defendant is unable to
      secure such acknowledgements from all current Western Union agents,
      despite notice of this requirement, Defendant shall retain proof of
      distribution of this Order to all current Western Union agents, such as an
      electronic mail receipt, a certified mail receipt, or an affidavit of
      service.
	        	
	30













IX.

COMPLIANCE
REPORTING

IT IS FURTHER ORDERED that
Defendant make timely submissions to the Commission:

	A.	One (1) year after entry of this Order, Defendant must submit a
      compliance report, sworn under the penalty of perjury, that:
	        	        	 
		1.	Identifies
      the primary physical, postal, and email address and telephone number, as
      designated points of contact, which representatives of the Commission may
      use to communicate with Defendant;




	2.	Identifies any business entity that Defendant has any ownership
      interest in or controls directly or indirectly that may affect compliance
      obligations arising under this Order;
	 
	3.	Describes in detail whether and how Defendant is in compliance with
      each Section of this Order, including, but not limited to, describing the
      following:
	 
	        	a.	The number
      of Western Union agents, by country, identified by the procedures in
      Section III.B.3 of this Order;
		        	
		b.	The names,
      addresses, and telephone numbers of all Western Union agent locations that
      have been suspended, restricted, or terminated by Defendant for reasons
      related to fraud-induced money transfers, the dates of and the specific
      reasons for the suspensions, restrictions, or terminations, and, for
      Western Union agents that have been reactivated after suspension, the
      dates of the reactivations; and
	 
		c.	Evidence
      showing that Defendant has and is complying with the requirements of
      Sections I through V of this Order; and
	 
	4.	A copy of each Order Acknowledgment obtained pursuant to this
      Order, unless previously submitted to the
Commission.


31







	B.	Annually, unless otherwise stated in this Subsection, for a period
      of ten (10) years after Defendant’s submission of the compliance report
      required by Subsection A of this section, Defendant shall submit a
      compliance report, sworn under penalty of perjury, that:
	 
		1.	Notifies the Commission of any change in any designated point of
      contact within fourteen (14) days of the change;
	 
		2.	Notifies the Commission of any change in the structure of any
      entity that Defendant has any ownership interest in or controls directly
      or indirectly that may affect compliance obligations arising under this
      Order, including: creation, merger, sale, or dissolution of the entity or
      any subsidiary, parent, or affiliate that engages in any acts or practices
      subject to this Order, within fourteen (14) days of the
  change;
	 
		3.	Describes in detail whether and how Defendant is in compliance with
      each Section of this Order, including, but not limited to, describing the
      following:
	 
	        	        	a.	The number
      of Western Union agents, by country, identified by the procedures in
      Section III.B.3 of this Order;
			        	
			b.	The names,
      addresses, and telephone numbers of all Western Union agents that have
      been suspended, restricted, or terminated by Defendant for reasons related
      to fraud-induced money transfers, the dates of and the specific reasons
      for the suspensions, restrictions, or terminations, and, for Western Union
      agents that have been reactivated after suspension, the dates of the
      reactivations; and
			        	
			c.	Evidence showing that Defendant has and is complying
      with the requirements of Sections I through V of this
  Order;


32







	C.	Defendant must submit to the Commission notice of the filing of any
      bankruptcy petition, insolvency proceeding, or similar proceeding by or
      against Defendant within fourteen (14) days of its filing;
	        	 
	D.	Any submission to the Commission required by this Order to be sworn
      under penalty of perjury must be true and accurate and comply with 28
      U.S.C. § 1746, such as by concluding: “I declare under penalty of perjury
      under the laws of the United States of America that the foregoing is true
      and correct. Executed on: _____” and supplying the date, signatory’s full
      name, title (if applicable), and signature; and
		   
	E.	Unless otherwise directed by a Commission representative in
      writing, all submissions to the Commission pursuant to this Order must be
      emailed to DEbrief@ftc.gov or sent by overnight courier (not the U.S.
      Postal Service) to: Associate Director for Enforcement, Bureau of Consumer
      Protection, Federal Trade
      Commission, 600 Pennsylvania Avenue NW, Washington, DC 20580. The subject line must begin: FTC
      v. Western Union. 


33









	
      X.
    

		 
	
      RECORDKEEPING

		 
	
      IT IS FURTHER ORDERED
      that Defendant must create certain records for ten (10) years after entry
      of this Order, and retain each such record for five (5) years.
      Specifically, Defendant must create and retain the following records:
      

		 
	A.	Defendant’s current written programs and
      policies governing the detection and prevention of consumer fraud and the
      installation and oversight of its agents, including, but not limited to,
      its Anti-Fraud Program;
	        	
	B.	Defendant’s current policies and procedures
      governing consumer fraud education or training provided to Western Union
      agents or other appropriate personnel;
	 
	C.	All Western Union agent applications,
      records reflecting due diligence conducted by Defendant with respect to
      such applications, and with respect to agents whose contracts come up for
      renewal, and written agreements entered into with Western Union
      agents;
	 
	D.	Records of all complaints and refund
      requests, whether received directly or indirectly, such as through a third
      party, from any source, anywhere in the world, about potentially
      fraud-induced money transfers, and any response, including, but not limited to, the
      information listed in Section III.B.1 of this Order; 


34







	E.	Records reflecting all steps Defendant has
      taken to monitor the activity of its agents to detect, reduce and prevent
      consumer fraud, including, but not limited to, records of Defendant’s
      reviews, audits, or investigations of Western Union agents associated with
      consumer fraud, communications with such agents regarding consumer fraud
      matters, and any remedial action taken against agents due to
    fraud;
	        	
	F.	Copies of documents relating to compliance
      reviews or mystery shops conducted by Defendant of elevated fraud risk
      agent locations pursuant to Section IV of this Order; and
	 
	G.	All records necessary to demonstrate full
      compliance with each provision of this Order, including submissions to the
      Commission.


XI. 

COMPLIANCE
MONITORING

IT IS FURTHER ORDERED that,
for the purpose of monitoring Defendant’s compliance with this Order and any failure to transfer any
assets as required by this Order:


	A.	Within fourteen (14) days of receipt of a
      written request from a representative of the Commission, Defendant must:
      submit additional compliance reports
      or other requested information, which must be sworn under penalty of
      perjury; appear for depositions; and produce documents for inspection and
      copying. The Commission is also authorized to obtain discovery, without
      further leave of court, using any of the procedures prescribed by Federal
      Rules of Civil Procedure 29, 30 (including telephonic depositions), 31,
      33, 34, 36, 45, and 69; 
	        	 



	B.	For matters concerning this Order, the
      Commission is authorized to communicate directly with Defendant. Defendant
      must permit representatives of the Commission to interview any employee or
      other person affiliated with Defendant who has agreed to such an
      interview. The person interviewed may have counsel present;
  and
	        	
	C.	The Commission may use all other lawful
      means, including posing, through its representatives as consumers,
      suppliers, or other individuals or entities, to Defendant or any
      individual or entity affiliated with Defendant, without the necessity of
      identification or prior notice. Nothing in this Order limits the
      Commission’s lawful use of compulsory process, pursuant to Sections 9 and
      20 of the FTC Act, 15 U.S.C. §§ 49, 57b-1.


35







XII.

RETENTION OF
JURISDICTION

IT IS FURTHER ORDERED that this Court retains jurisdiction of
this matter for purposes of construction, modification, and enforcement of this
Order.

SO ORDERED this _____ day of __________ ,
2017.


	UNITED STATES DISTRICT
JUDGE




36







SO STIPULATED AND AGREED:


PLAINTIFF FEDERAL
TRADE COMMISSION 

	/s/ Karen D. Dodge	     	Dated:  	   January 19, 2017
	
      KAREN D. DODGE (IL
      6204125)
JOANNIE T. WEI (IL 6276144) 
ELIZABETH C. SCOTT (IL
      6278075) 
Attorneys for Plaintiff 
Federal Trade Commission 
55
      West Monroe Street, Suite 1825 
Chicago, Illinois 60603
      
kdodge@ftc.gov
      (Dodge) 
jwei@ftc.gov (Wei)
      
escott@ftc.gov
      (Scott) 
			



DEFENDANT THE WESTERN
UNION COMPANY 

	/s/ John R. Dye	     	Dated:  	  January 18, 2017
	JOHN R.
      DYE
Executive Vice President and General
Counsel



COUNSEL FOR DEFENDANT THE
WESTERN UNION COMPANY 

	/s/ Edward B. Schwartz	     	Dated:  	  January 18, 2017
	
      EDWARD B. SCHWARTZ (DC
      429690) 
Steptoe & Johnson LLP 
Attorneys for Defendant 
1330 Connecticut
      Avenue, NW 
Washington, DC 20036 
(202) 429-6220 (telephone)
      
(202) 429-3902 (facsimile) 
eschwartz@steptoe.com





37







	/s/ Sean M. Berkowitz	     	Dated:  	  January 18, 2017
	
      SEAN M. BERKOWITZ (IL 6209701) 
Latham & Watkins LLP 
Attorneys for Defendant 
330 North Wabash Avenue, Suite 2800
      
Chicago, Illinois 60611 
(312) 777-7016 (telephone) 
(312)
      993-9767 (facsimile) 
sean.berkowitz@lw.com
			




38







IN THE UNITED STATES
DISTRICT COURT 
FOR THE MIDDLE DISTRICT OF PENNSYLVANIA 

	 	)	
	FEDERAL
      TRADE COMMISSION,	)	
	 	)	
	Plaintiff,	)	
	 	)	Civil Action
      No.
	v.	)	
	 	)	
	THE WESTERN
      UNION COMPANY, 	)	
	a
      corporation, also doing business as	)	
	Western
      Union Financial Services, Inc.,	)	
	and
      through other subsidiaries and affiliates, 	)	
	 	)	 
	Defendant.	)	
		)	



COMPLAINT FOR
PERMANENT INJUNCTIVE
AND
OTHER EQUITABLE RELIEF

Plaintiff, the Federal Trade
Commission (“FTC”), for its complaint alleges: 

1. The FTC brings this action
under Section 13(b) of the Federal Trade Commission Act (“FTC Act”), 15 U.S.C. § 53(b), and the Telemarketing and
Consumer Fraud and Abuse Prevention Act (“Telemarketing Act”), 15 U.S.C. §§
6101-6108, to obtain permanent injunctive relief, rescission or reformation of
contracts, restitution, the refund of monies paid, disgorgement of ill-gotten
monies, and other equitable relief for Defendant’s acts or practices in
violation of Section 5(a) of the FTC Act, 15 U.S.C. § 45(a), and in violation of
the FTC’s Trade Regulation Rule entitled “Telemarketing Sales Rule” (“TSR”), 16
C.F.R. Part 310, in connection with
Defendant’s failure to take timely, appropriate, and effective measures to
mitigate fraud in the processing of money transfers sent by consumers.


1 







JURISDICTION AND
VENUE 

2. This Court has subject
matter jurisdiction pursuant to 28 U.S.C. §§ 1331, 1337(a), and 1345, and 15 U.S.C. §§ 45(a), 53(b), 6102(c), and
6105(b). 

3. Venue is proper in this
district under 28 U.S.C. § 1391(b)(2), and (c)(2), and 15 U.S.C. § 53(b). 

PLAINTIFF

4. The FTC is an independent
agency of the United States Government created by statute. 15 U.S.C. §§ 41-58.
The FTC enforces Section 5(a) of the FTC Act, 15 U.S.C. § 45(a), which prohibits
unfair or deceptive acts or practices in or affecting commerce. The FTC also
enforces the Telemarketing Act, 15 U.S.C. §§ 6101-6108. Pursuant to the
Telemarketing Act, the FTC promulgated and enforces the TSR, 16 C.F.R. Part 310,
which prohibits deceptive and abusive telemarketing acts or practices.


5. The FTC is authorized to
initiate federal district court proceedings, by its own attorneys, to enjoin
violations of the FTC Act and the TSR, and to secure such equitable relief as
may be appropriate in each case, including rescission or reformation of
contracts, restitution, the refund of monies paid, and the disgorgement of ill-gotten monies. 15 U.S.C. §§
53(b), 56(a)(2)(A)-(B), 6102(c), and
6105(b). 

2 







DEFENDANT

6. Defendant The Western Union
Company (“Western Union”), also doing business as Western Union Financial
Services, Inc., and through other subsidiaries and affiliates, is a Delaware
corporation with its principal place of business at 12500 East Belford Avenue,
Englewood, Colorado 80112. Western Union transacts or has transacted business in
this district, as well as throughout the United States and the world.


7. Western Union operates, and
enters into contracts for the provision of, money transfer services worldwide,
through numerous subsidiaries and affiliates, including, but not limited to,
Western Union Financial Services, Inc., Western Union Payment Services Ireland
Limited (“WUPSIL”), Western Union Payment Services Network EU/EEA Limited,
Western Union Financial Services (Canada) Inc., Western Union Network Ireland
Ltd., Western Union Network Canada Company, Western Union Network France SAS,
Western Union Network Belgium Sprl., Western Union Payment Services UK Ltd.,
Western Union International Bank GmbH, American Rapid Corporation, Grupo
Dinamico Empresarial, S.A. de C.V., Servicio Integral de Envios, S.A. de C.V.,
and Operaciones Internacionales OV, S.A. DE C.V. 

3 







COMMERCE

8. At all times material to
this Complaint, Defendant has maintained a substantial course of trade in or
affecting commerce, as “commerce” is defined in Section 4 of the FTC Act, 15
U.S.C. § 44. 

BACKGROUND

9. For many years, Western
Union’s money transfer system has been used by fraudsters around the world to
obtain money from their victims. Discrete subsets of Western Union agents in
various countries have largely been responsible for processing the payments, and
many Western Union agents have played active and important roles in facilitating
those frauds. As described more fully below, although Western Union has long
been aware and has received many warnings that its system is being used for
frauds, for many years it has failed to implement adequate and effective
policies and procedures to detect and prevent fraud and to take prompt action to
effectively address problematic agent locations. In some instances, Western
Union’s agent locations have been, or likely been, complicit in the frauds, and
have engaged in suspicious activities indicative of complicity in paying out
fraud-induced money transfers. In other cases, Western Union’s agent locations
have facilitated the scams by paying out fraud-induced money transfers in
violation of Western Union’s anti-fraud and/or Anti-Money Laundering (“AML”)
policies and procedures that impact consumer fraud. Western Union has known about the problem and
has identified many of the agents providing substantial assistance or support to
the frauds. Although as a result of the FTC’s investigation, Western Union has
improved aspects of its anti-fraud program since 2012, Western Union still has
failed in many cases to promptly suspend and terminate agent locations
facilitating fraud. Instead, Western Union has continued to profit from the
activities of these agents.


4 













Western Union’s Money
Transfer System 

10. Western Union offers money
transfer services to consumers worldwide through a network of approximately
515,000 agent locations in more than 200 countries and territories. Western
Union is the largest money transfer company in the United States and worldwide.
More than 50,000 of its 515,000 agent locations are in the United States. In
addition to offering money transfer services under the Western Union brand,
Western Union owns and operates Orlanda Valuta (“OV”), which provides money
transfer services primarily to Mexico, and Vigo, which provides money transfer
services primarily to Latin America and the Caribbean. Consumers in the United
States can send money transfers through OV and Vigo from thousands of Western
Union agent locations. According to Western Union, “[e]very day, millions of
consumers rely on Western Union Money Transfer® service to send money to loved
ones near and far.” 




11. Consumers wishing to send
funds using Western Union’s money transfer system may initiate a transaction in
person, online, or over the telephone. Western Union claims that its locations
are “around every corner” with “knowledgeable agents,” and that its money
transfer services are “fast, convenient, and safe.” Although the amount that may
be sent online or over the telephone is sometimes restricted, there typically
are no restrictions on the amount of money that a consumer can send in person
from agent locations. Certain countries, however, limit the amount of money that
can be picked up from agent locations. For in-person money transfers, consumers
must pay with cash or a bank-issued debit card. For online or telephone
transfers, consumers typically must pay with a credit or debit card. Over 90% of
money transfers sent through Western Union are initiated in person at Western
Union’s agent locations. 

12. When initiating a money
transfer at one of Western Union’s agent locations, the sender must complete a
“send form,” which typically requires the sender’s name, address and telephone
number, and the name of the recipient and the city, state/province, and country
to which the money transfer is being sent. Consumers initiating money transfers
at Western Union’s agent locations may select from Western Union’s “Money in
Minutes” or “Next Day” services, where available. For money transfers above a
certain amount, such as $1,000, the sender must present identification (“ID”)
and the agent locations must record in Western Union’s system the sender’s ID
information. Over time, in some countries, Western Union has lowered the amount
that triggers the ID requirement.

5







13. In order to send a money
transfer, consumers must pay a fee to Western Union. This fee varies depending upon the method of the money
transfer, the destination, the amount, the method of payment, and how quickly
the money transfer is to be completed. The money transfer fee for Western
Union’s “Money in Minutes” service is higher than its “Next Day” service.
According to Western Union’s website, to send a $1,000 “Money in Minutes” money
transfer from the United States to the United Kingdom (“UK”), consumers must pay
an $81 transfer fee if paying by credit or debit card, or $58 if paying in cash.
For international money transfers, in addition to charging consumers a money
transfer fee, Western Union also makes money from the foreign currency exchange.
Upon initiating a money transfer, consumers are provided with a unique tracking
number called a Money Transfer Control Number (“MTCN”). 

14. Prior to paying out funds
at its agent locations, Western Union’s practice is generally to require the
recipient to provide the MTCN, to complete a “receive form” with the recipient’s
name, address and telephone number, and to present ID. For many years, for money
transfers of less than $1,000, even though recipients may have been required to
present ID, Western Union agent locations worldwide have not been required to
record in Western Union’s system the recipient’s ID information. When the
recipient does not have an ID and the money transfer is less than $1,000, the
sender sometimes has the option of using a “Test Question and Answer.” According
to Western Union, this option “is designed for emergency situations where the
receiver doesn’t have proper identification” because his or her wallet was
stolen. 


15. Regardless of the method
used to initiate the money transfer, all Western Union money transfers flow
through the same global money transfer system controlled by Western Union. This
system coordinates and makes funds available to complete the transactions.
Agents must have active accounts with Western Union to send and receive money
transfers using Western Union’s money transfer system. 

16. Once Western Union’s agent
locations have paid out the funds, Western Union’s policy typically is that the
sender cannot obtain a refund from Western Union of either the amount
transferred or the money transfer fee, even if the sender was a victim of fraud
or the money transfer was paid out to someone other than the intended recipient.
The policy even applies if the Western Union agent location was complicit in the
fraud, engaged in suspicious activity, or failed to follow Western Union’s
policies and procedures when processing the money transfer (e.g., by failing to record the recipient’s ID or other required information).


6







Use of Western Union’s
Money Transfer 
System to Facilitate Fraud and Harm Consumers

17. Over the years, money
transfers have increasingly become the payment method of choice for scams that
prey on consumers around the world. Fraudulent telemarketers and con artists
prefer to use money transfers to facilitate their scams because, among other
reasons, they can pick up money transferred within minutes at multiple locations
and, oftentimes, the perpetrators are afforded anonymity because the payments
are untraceable. For example, money transfers can be picked up at any location
within a particular state or country; some money transfers can be picked up
without presenting or having to record an ID; fake names, addresses, and IDs
sometimes can be used; and Western Union’s own agent locations sometimes fail to
follow the company’s policies and procedures in paying out money transfers, and
in other instances, are complicit in the frauds. Therefore, it is often
difficult for consumers and law enforcement to identify and locate the
recipients of fraud-induced money transfers. 

18. Western Union maintains a
database of complaints it receives about fraud-induced money transfers. Based on
information in that database, between January 1, 2004 and August 29, 2015,
Western Union received at least 550,928 complaints about fraud-induced money
transfers, totaling at least $632,721,044. Over 80% of the complaints in the
database were from U.S. consumers. The average individual consumer fraud loss
reflected in that database was approximately $1,148. That is more than three
times the amount of Western Union’s average money transfer for the years 2010
through 2014—approximately $346—and more than seven times the amount of Western
Union’s median money transfer for the same period—approximately $162.

19. As explained more fully
below, the complaints in Western Union’s database represent only a small
percentage of the actual fraud perpetrated through Western Union’s money
transfer system because most victimized consumers do not complain directly to
Western Union. In addition, Western Union also does not include information in
its database about all of the complaints it receives. Therefore, since at least January 1, 2004, it is
likely that Western Union’s money transfer system has been used to send billions
of dollars in fraud-induced payments to telemarketers and con artists worldwide.


7








Western Union’s
Contractual Authority 
to Oversee and Take Action Against its
Agents

20. Western Union requires
that its agents, which are also referred to as authorized delegates or
representatives, sign written agreements in order to offer and provide payment
services through Western Union’s money transfer system. The initial terms of the
written agreements typically are five years, after which they are renewable for
additional periods of time. Western Union pays its agents in the United States
an agreed-upon commission, performance bonus, and volume bonus for offering and
processing money transfer services on Western Union’s behalf, while it pays its
international agents an agreed-upon base compensation for the consumer fee
received, and a percentage of the foreign exchange profits, on each transaction.


21. Western Union’s written
agreements with its agents typically require the agents to comply with all
applicable laws, including laws for detecting and preventing money laundering.
These agreements also provide that Western Union has the right to immediately
suspend or terminate its agents, including any agent location. Western Union’s
agents are required to keep records for all transactions, provide them to
Western Union upon request, and cooperate with any audit or review by Western
Union. The agreements also provide Western Union with the right to inspect and
audit its agents’ books and records to monitor the agents’ compliance with the
agreement, applicable law, and Western Union’s policies. 

22. Western Union’s agents,
which are also sometimes referred to as “network agents,” “master agents,” or
“super-agents,” in many instances provide Western Union’s money transfer
services through their own networks or locations, or, in countries outside of
the United States and Canada, also through sub-representatives, which Western
Union commonly refers to as “subagents” (hereinafter collectively referred to as
“agents” or “subagents”). Western Union typically is not involved in enrolling
its agents’ subagents and does not have a direct contractual relationship with
them. Western Union’s agreements with its agents, however, provide it with the
authority to suspend and terminate its agents’ subagents, as well as any
location at which its money transfer services are offered. 

8







Western Union’s Programs,
Policies, and Procedures 

23. Western Union has two
primary programs relating to the detection and prevention of consumer fraud and
the installation and oversight of agents: its anti-fraud program, which
sometimes is referred to as its consumer protection program, and its AML
program. As implemented by Western Union, for many years these interrelated
programs failed to adequately and effectively detect and prevent consumer frauds
employing Western Union’s money transfer system. Western Union’s design and
implementation of these programs for addressing fraud, as well as its oversight
of its global money transfer system, occur primarily within the United States.


24. For many years, Western
Union has failed to implement a comprehensive and effective anti-fraud program.
In or around April 2003, after Western Union became aware that some of its
agents had been suspected of being involved in paying out fraud-induced money
transfers to telemarketers, Western Union’s Security Department developed a
Standard Operating Procedure (“SOP”) for reviewing and suspending agents for
consumer fraud. The SOP outlines a process and guidelines for identifying agents
for review and suspension based on consumer fraud complaints, as well as a
process for reinstating or terminating agents. The SOP was revised at various
times, most recently in or around September 2010. Beginning in or around January
2006, the SOP included procedures that applied to agents outside of the United
States and Canada. However, to the extent that Western Union suspended and/or
terminated agents pursuant to the SOP, for many years the suspensions and/or
terminations were typically limited to agents in the United States and Canada.


25. In a written report in
January 2011, Western Union represented it was making “enhancements” to its
consumer protection program that were to include improvements to the company’s
program for conducting due diligence and training of its agents, monitoring
agent activity, and taking disciplinary action, including suspension and
termination, against agents. Subsequently, in a written report about its
anti-fraud program dated September 14, 2012, Western Union claimed it had
implemented “a comprehensive anti-fraud program” that included agent training,
agent monitoring, and “[p]rompt action, including suspensions and terminations,
against Agents when the Company identifies fraudulent activity.” Western Union
recognized in this report that its “first line of defense against fraud is to
engage Agents who will fully comply with the Anti-Fraud program and policies and
procedures.” 




9







26. As a result of the FTC’s
investigation, Western Union has made progress since 2012 in identifying and
blocking potentially fraudulent transactions and in otherwise protecting
consumers from fraud. Despite that, Western Union continued to fail, in certain
cases, to promptly suspend and terminate certain high-fraud agent locations,
including locations that appeared to be complicit in paying out fraud-induced
money transfers or repeatedly failed to comply with Western Union’s anti-fraud
and AML programs, policies, and procedures. 

27. In addition to its
anti-fraud program, Western Union is required by the Bank Secrecy Act (“BSA”) to
have an effective AML program to guard against money laundering, including, but
not limited to, guarding against the flow of illicit funds, such as funds
derived from fraud. As part of its AML program, Western Union has developed Know
Your Agent guidelines and policies, and policies and procedures for monitoring
transaction, customer, and agent activity for risks, including suspicious
activity and agent complicity. Western Union’s AML program relies heavily upon
its agents to have their own AML programs. In many cases, Western Union or its
agents have failed to implement effective AML policies and procedures pertaining
to consumer fraud, thereby making Western Union’s money transfer system more
vulnerable to consumer fraud. 

28. As described below,
Western Union has failed to: promptly investigate, suspend, and terminate
potentially complicit agents and subagents, or agents and subagents that have
failed to comply with Western Union’s anti-fraud and/or AML policies and
procedures that impact consumer fraud; conduct
adequate due diligence on
prospective and existing agents and subagents; effectively train, monitor, and
review agents, subagents, and front line associates, who are responsible at the
point of sale for processing money transfers at Western Union’s agent locations
(“FLAs”), with respect to consumer fraud; adequately collect, record, and report
consumer fraud involving its money transfer system; and adopt other reasonable
measures to prevent fraud-induced money transfers. In some cases Western Union
has failed to adopt adequate and effective policies and procedures to detect and
prevent fraud-induced money transfers, while in other cases it has failed to
adhere to its own anti-fraud and AML programs, policies, and procedures. 

10













WESTERN UNION’S MONEY
TRANSFER
SYSTEM HAS
REGULARLY BEEN USED FOR FRAUD

29.
Perpetrators of many different types of mass marketing and imposter scams have
relied on money transfer systems, including Western Union’s system, as a means
of fraudulently obtaining money from consumers around the world. All of these
scams operate deceptively in violation of Section 5 of the FTC Act, and many of
the scams also involve fraudulent telemarketing in violation of the TSR.


30.
In these scams, consumers often are instructed over the telephone or by email to
send money transfers through Western Union’s money transfer system. The
telemarketers and con artists use false or misleading statements to induce
consumers either to pay for purported goods or services, or to make payments as
a 15 result of purported circumstances, such
as emergencies, that do not exist. Consumers’ fraud-induced payments through
Western Union’s system often exceed $1,000 per transaction. The types of scams
referenced in Western Union’s own complaint database include, but are not
limited to: 


a.
Online or Internet purchases
(see FTC Consumer Alert on Online purchases, available at http://www.ftc.gov/news-events/press-releases/2006/07/ftc-advises-consumers-not-use-wire-transfers-online-purchases): According to Western Union’s complaint
database, between January 1, 2004 and August 29, 2015, the company received at
least 146,909 complaints about this type of scam totaling at least $187,877,003
in losses;

b.
Lottery or prize scams
(see http://www.consumer.ftc.gov/articles/0086-international-lottery-scams): According to Western Union’s complaint
database, between January 1, 2004 and August 29, 2015, the company received at
least 75,543 complaints about this type of scam totaling at least $86,138,055 in
losses;

c.
Emergency scams, including
grandparent scams (see http://www.consumer.ftc.gov/articles/0204-family-emergency-scams): According to Western Union’s complaint
database, between January 1, 2004 and August
29, 2015, the company received at least 41,897 complaints about this type of
scam totaling at least $73,807,353 in losses;

11







d.
Advance-fee loan scams
(see http://www.consumer.ftc.gov/articles/0078-advance-fee-loans): According to Western Union’s complaint
database, between January 1, 2004 and August 29, 2015, the company received at
least 71,296 complaints about this type of scam totaling at least $43,617,107 in
losses; and

e.
Online dating or romance scams
(see http://www.ftc.gov/news-events/press-releases/2010/11/ftc-warns-consumers-about-online-dating-scams): According to Western Union’s complaint
database, between January 1, 2004 and August 29, 2015, the company received at
least 44,588 complaints about this type of scam totaling at least $40,980,482 in
losses. 

31.
When consumers send the money transfers from one of Western Union’s agent
locations, the perpetrators of the scams described above, or those acting on
their behalf, frequently collect the funds from one of Western Union’s corrupt
or complicit agent locations or from agent locations that violate Western
Union’s anti-fraud and/or AML policies and procedures, such as by failing to
properly collect and record all of
recipients’ IDs or biological information, or by recording obviously false information.


12







A DISCRETE SUBSET OF
WESTERN UNION
AGENTS
WORLDWIDE HAS PAID OUT THE

MAJORITY OF
FRAUD-INDUCED MONEY TRANSFERS 

32.
Western Union’s records show that the majority of fraud-induced money transfers
have been paid out by a discrete, and easily identifiable, subset of Western
Union’s agents and subagents in various countries around the world. The vast
majority of Western Union agent locations worldwide do not pay out transactions
associated with a single fraud complaint to Western Union. In fact, only a small
and discrete subset of agents and subagents worldwide pay out money transfers
relating to any fraud complaints. An even more easily identifiable and distinct
subset of agents and subagents have been the subject of five or more fraud
complaints in a given year, but this group of Western Union agents has been
responsible for paying out most of the reported fraud losses. For
example:

a.
In 2012, 137 agent locations in Mexico (out of an average of 17,710 locations operating in that country each
month of the year) had five or more fraud complaints, and these 137 agents were
responsible for paying out approximately $3.2 million, amounting to over 80% of
the total reported fraud for Mexico that year. Similarly, in 2013, 140 agent
locations in Mexico (out of an average of 9,002 locations) paid out
approximately $2.1 million, amounting to over 75% of the total reported fraud in
Mexico, and in 2014, 108 agent locations (out of an average of 8,345 locations)
paid out approximately $1.5 million, amounting to over 76% of the total reported
fraud.

13







b.
In 2012, 188 agent locations in Nigeria (out of an average of 5,036 locations in
that country) had five or more fraud complaints, and these 188 agents paid out
approximately $1.9 million, amounting to over 77% of the total reported fraud
for Nigeria that year. In 2013, 235 agent locations in Nigeria (out of an
average of 5,034 locations) paid out approximately $1.5 million, amounting to
over 71% of the total reported fraud in Nigeria, and in 2014, 269 agent
locations (out of an average of 5,208 locations) paid out approximately $2.6
million, amounting to over 84% of the total reported fraud. 

33.
Western Union’s internal reports and memoranda show that the company was aware
that discrete and easily identifiable subsets of agents and subagents in various
locations were responsible for paying out the majority of fraud-induced money
transfers. For example, a Financial Intelligence Report titled “G.A.P. – United
Kingdom” stated that a review of fraud complaints in late 2009 revealed that one
network of agents “accounted for more consumer Fraud Complaints than any other
Agent Network in the United Kingdom” and that an analysis of data in the first
quarter of 2010 for nineteen agents demonstrated “indicators of Agent
complicity.” A January 19, 2012 memorandum regarding “GMI Fraud Monitoring and
Intelligence” stated that in Spain “when looking at a list of 30 Agents that
were investigated in 2010 it was determined that the amount of potential fraud
identified by GMI surpassed the total number of formal fraud complaints and
amounts for the entire country in 2010, demonstrating the true levels of fraud
related risk present in Spain.” (Emphasis in original.) In March 2012, a senior
compliance analyst found that from December 1, 2011 to February 24, 2012,
“nearly 85% of all emergency fund fraud complaints filed with Western Union”
involved money transfers paid out by one master agent in Mexico, Elektra,
through 94 of its locations.

14







MANY WESTERN UNION
AGENTS HAVE BEEN
ACTIVE OR COMPLICIT IN THE UNDERLYING
SCAMS

34.
Many Western Union agent locations that have received fraud-induced money
transfers from consumers and paid out such transfers to the fraudulent
telemarketers and con artists have been complicit in the underlying scams. In
some cases, the sellers, telemarketers, or imposters who have operated the scams
have been Western Union’s own agents or subagents. 

35.
At least 146 of Western Union’s agents and subagents around the world, as well
as at least two FLAs, have been charged with acting collusively in the frauds
employing Western Union’s money transfer system. Of the 146 agents, 39 agents in the United States and Canada have
been charged in the United States with defrauding consumers through various mass
marketing and/or telemarketing schemes including fraudulent sweepstakes, advance
fee loans, business opportunities (including secret shopper or work-at-home
scams), emergency or person-in-need schemes, and/or Internet purchase offers.
The charges against these 39 agents have included conspiracy to commit mail
fraud, wire fraud and/or money laundering, and most of the agents have already
pleaded guilty or been convicted of the charges. These 39 agents paid out over
$5.2 million in money transfers that were reported to Western Union as having
been induced by fraud. As explained below, however, actual consumer losses far
exceed the reported losses. These matters include: 


	Case	Western Union Agents
	United States v. Agbasi,
      et al., No. 07-CR-504 (M.D. Pa.)	Stanley
      Akubueze and Christopher Ozurus (d/b/a Afro Spot Restaurant) 

Philip Utomi
      (d/b/a Swift Cash Centre)
	United States v. Bellini,
      et al., No. 07-CR-1402 (C.D. Cal.)	Vijayakumar
      Ramakrishnan (d/b/a Cafe Chambly) 

John Felix Alexander (d/b/a Imudia
      Int)
	United States v. Ayodele,
      et al., No. 10-CR-058 (M.D.
Pa.)	Soji Ayodele
      (d/b/a Total Communications Centre) 

Mohsen Golab (d/b/a Golden Century) 

Christian Kevin (d/b/a C K Business Service)
	United States v. Akinola,
      et al., No. 10-CR-300 (S.D.
    Tex.)	Jonathan
      Akinola (d/b/a Postal & Wireless Outlet)
	United States v. Groysman, No.
      10-CR-326 (M.D. Pa.)	Bella
      Groysman (d/b/a Professional Medical Supplies)


15







	United States v. Dobrovinsky-Kaz, No.
      10-CR-327 (M.D. Pa.)	Tatyana
      Dobrovinsky-Kaz (d/b/a Professional Medical Supplies)
	United States v. Abbey, No.
      10-CR-344 (M.D. Pa.)	Festus G.
      Abbey (d/b/a Abbey’s One Stop and Abbey Multi Service)
	United States v. Nwuda, No.
      10-CR-508 (C.D. Cal.)	Nmandi Nick
      Nwuda (d/b/a CKane Check Cashing & Postal)
	United States v. Idemudia, No.
      11-CR-001 (M.D. Pa.)	Eugene
      Idemudia (d/b/a IV Beauty Supply and RM & E)
	United States v. Agho,
      et al., No. 11-CR-113 (M.D.
Pa.)	Betty Agho
      (d/b/a Star Multiservice) 

Itohan Agho-Allen (d/b/a Miracle Multi Link) 

Prince Edosa (d/b/a Gosa Multi Services and A & M Communications)

Kennedy Onaiwu (d/b/a Kenizo Enterprise)

Ikejiani Okoloubu (d/b/a First Cone and Depanneur Ice) 

Susan Osagiede (d/b/a A & M Communications) 

Elvis Uadiele (d/b/a Diale Investment)

Nekpen Omorodion (d/b/a Global
      Multiservices)
	United States v. Adigun,
      et al., No. 11-CR-151 (M.D.
      Pa.)	Olufemi
      Adigun (d/b/a FAB)
	United States v. Louissaint, No.
      11-CR-201 (M.D. Pa.)	Emmanuel
      Louissaint (d/b/a Hudson Food Market II)
	United States v. Brown, No.
      12-CR-001 (M.D. Pa.)	Blessing
      Brown (d/b/a O & B Enterprise Inc)
	United States v. Mayele, No.
      12-CR-210 (C.D. Cal.)	Prince
      Martin Mayele (d/b/a Du Monde Digital Trades)
	United States v. Mgbolu,
      et al., No. 12-CR-232 (M.D.
      Pa.)	Alex Mgbolu
      (d/b/a FA CAM Assoc. & Financial Corp)

Chima Nneji (d/b/a Advanced
      Computer Service and Hallmark Business Services)

William Nneji (d/b/a
      Hallmark Business Services)


      16







	United States v. Idisi-Arah,
      et al., No. 12-CR-311 (M.D.
      Pa.)	Lucas Obi
      (d/b/a Canada Cash Express)
	United States v. Anyika,
      et al., No. 14-CR-006 (M.D.
Pa.)	Ejike
      Egwuekwe (d/b/a Merrick Multiple Services and Lincoln One Stop Place) 

      Franklyn Idehen (d/b/a Treasure Links and Cherrish Communication Center) 

Nnamdi Ihezuo (d/b/a Net Global & Multi Services)

Cyprian Osita Ngbadi
      (d/b/a Rockaway Business Center)
	State of Texas v. Mbaka, No.
      09-DCR-52310A (Tex. Dist. Ct. Ft. Bend County)	Boniface
      Ifeanyi Mbaka (d/b/a BIM Services)



36.
Criminal law enforcers in other countries also have taken action against at
least an additional 107 Western Union agents and two FLAs, including in the
following instances:

a.
Sentencing in the UK (in or around November 2012) of an individual, Peter
Oyewor, who operated at least two Western Union agent locations (d/b/a Benson
Logistics and Abmec Logistic) and was found guilty of money laundering over
£1.34 million in proceeds from consumer frauds;


b. Arrests made by the Nigerian
Special Fraud Unit (in or around June
2013) of two FLAs at a Western Union location (Skye Bank PLC) for aiding
Internet fraudsters; and 

c.
Arrests made by the Spanish police (in or around July 2014) of 105 Western Union agents in Spain, who were
involved in a massive international scam
involving Nigerian frauds that primarily targeted U.S., Canadian, and German
consumers, and caused at least €11.5 million (approximately $15.5
million) in consumer injury. 

17







WESTERN UNION HAS BEEN
AWARE THAT ITS SYSTEM
HAS BEEN USED FOR FRAUD-INDUCED MONEY
TRANSFERS

37. Since at least January
2004, Western Union has been aware that its system has regularly been used for
fraud and that it has an identifiable subset of agents and subagents with high
levels of fraud complaints. It also has been aware that many of its agent
locations with high-fraud payouts have: (1) violated Western Union’s anti-fraud
and/or AML policies and procedures; (2) engaged in suspicious activities; and/or
(3) been complicit, or likely complicit, in the frauds. Western Union’s
awareness of the consumer fraud problem is demonstrated by, among other things,
the hundreds of thousands of complaints it has received from consumers, its own
internal records and reports, and years of warnings from government agencies
throughout the world. 

Defrauded Consumers Have
Regularly Complained to Western Union 

38. When consumers realize
that they have been defrauded, they sometimes contact Western Union to report
the fraud, often using a toll-free number made available by Western Union to
consumers in certain countries, including the United States. In some cases,
consumers also have filed lawsuits against Western Union due to the company’s
role in processing the fraud-induced money transfers. In addition,
as described above, between approximately January 1, 2004 and August 29, 2015,
Western Union’s database shows at least 550,928 complaints it received about at
least $632,721,044 in fraud-induced money transfers. Western Union also has
other records reflecting additional complaints it received, which were not
recorded in the database, including a spreadsheet of at least 8,497 complaints
Western Union received in 2005 regarding fraud-induced money transfers, which
totaled at least $14,478,365. 

18













39. The complaints reported to
Western Union, however, represent only a fraction of the consumer frauds
employing Western Union’s money transfer system for at least three
reasons:

a. For years, Western Union
has failed to provide victims in many countries worldwide with access to a fraud
hotline, or a toll-free telephone number for victims to call to report fraud,
which is the most convenient mechanism for many victims to promptly report
fraud;

b. The majority of consumer
victims do not complain directly to Western Union. Western Union’s own internal reports recognize that only a
small percentage of consumers complain about fraud and that the volume of
fraud-induced money transfers is much higher than that reported to the company.
For example, Western Union has recognized in several reports that the actual
amount of fraud-induced money transfers
associated with agent locations was in some cases over five times higher than
the reported complaint figures; and

c. As further explained below, Western Union’s database of fraud
complaints is incomplete because Western Union has failed to log in its database
all of the complaints and reports about fraud it has received, as well as all of
the fraud-induced money transfers related to the complaints. 

19







Western Union’s Internal
Reports and Records Demonstrate Awareness of Consumer Fraud by Agents in Various Countries
Worldwide

40. Since at least 2005,
Western Union has conducted reviews and investigations, and generated indices
and reports, related to consumer fraud involving its money transfer system.
Information contained in Western Union’s internal reports, communications, and
other records demonstrates that the company has been aware of high levels of
consumer fraud involving particular countries and agents, including network
agents Western Union itself owns. These records demonstrate serious problems and
suspicious activities by particular Western Union agents and subagents,
including, but not limited to: (a) high numbers and patterns of complaints; (b)
spikes in the number of money transfers received; (c) money transfer amounts
that far exceed the average transfer amount; (d) data integrity issues (issues
relating to the recording of ID numbers, dates of birth, or other information
about recipients); (e) payouts within minutes after the money transfers were sent; (f) flipping (shortly after
receiving funds, a large portion of the money is sent to another recipient); (g)
surfing (suspicious look-ups of money transfers in Western Union’s system by
FLAs); and (h) substantial sends to high-risk countries known for fraud.


41. According to information
contained in Western Union’s complaint database, the United States has been the
top country for fraud payouts since at least 2004 and has generated over three
times the number of complaints as the next highest country. In fact, over $128.2
million in reported fraud has been paid out in the United States since 2010, and
Western Union has received more than 34,000 fraud complaints about transactions
totaling over $21.2 million since 2014. Certain agent locations in the United
States have operated for years despite high levels of fraud. For example,
between July 2008 and March 2015, one agent location in Washington, D.C.
generated at least 116 fraud complaints totaling $187,356. Even though reviews
of the agent in June 2014 and February 2015 identified confirmed and potential
fraud amounting to 84% and 55% of the money transfers paid at that location, the
agent was not terminated until August 2015, after it failed an undercover test
visit by a compliance officer tasked with assessing the agent’s AML compliance.
Another agent location in Detroit, Michigan, paid out at least 194 money
transfers totaling $379,031 in reported fraud since 2004. Although this agent has received Western Union’s fraud prevention
training multiple times, it has continued to receive fraud complaints. 

20







42. Over the years, many other
countries in addition to the United States have emerged as high-risk countries
for fraud as international scams have become more pervasive. For example, from
2006 to 2012, the UK was the second highest-payout country for fraud-induced
money transfers behind the United States. During that time, Western Union’s UK
agents paid out over $82.4 million in reported fraud, and internal reports and
records demonstrate that Western Union was aware of problems with particular
agents in the UK. From January 1, 2004 to August 29, 2015, 172 UK agents paid
out over $44.3 million in reported fraud. A subset of only 34 of these agents
was responsible for paying out nearly half of the reported fraud (at least $21.2
million), most of which came from U.S. victims. The actual fraud paid out by
these agents was likely much higher. Total payouts by these agents during the
period they were receiving fraud complaints amounted to $389 million, with $154
million of that coming from U.S. senders. Notably, these agents also sent $104.6
million to Nigeria and $76.6 million to Romania, both of which are high-risk
countries for fraud, as acknowledged by Western Union itself. One agent alone,
News Mark, was the top fraud agent in the UK and worldwide. Between January 1,
2006 and January 14, 2013, Western Union received at least 1,421 fraud
complaints about News Mark totaling at least $2,150,892, of which over 84%, or $1,815,582, involved U.S. victims.
Although Western Union identified News Mark as a high-fraud agent in the
company’s 60-day reports at least 45 times between 2005 and 2010, and reviewed
it for fraud and other suspicious activities at least fifteen times between 2009
and 2012, Western Union suspended and reactivated News Mark at least three
different times before finally terminating it in 2014. 


43. By 2007, Western Union was
aware that Jamaica had become a hotbed for fraud. In that year alone, Western
Union received at least 3,065 complaints from U.S. consumers about money
transfers totaling $1,878,435 to Jamaica. Over the years, the top four fraud
payout agents in Jamaica have processed well over $1 million each in reported
fraud, for a combined total of at least $5,210,644. According to internal
Western Union reports, those agents also have engaged in other highly suspicious
activities, such as surfing. One of those agents, for example, surfed at least
985 transactions in a single month in 2010. Even though all four of these agents
have continued to receive many fraud complaints for years, including hundreds in
2015, they continue to operate. In fact, Western Union has only terminated one
agent in Jamaica for consumer fraud. That termination occurred on July 3, 2015,
and the terminated agent had a much smaller number of fraud complaints than
others that Western Union has not terminated. 

21







44. In 2008, according to
Western Union’s records, Mexico was one of the top five countries worldwide for
fraud payouts, with 1,393 complaints totaling over $1.8 million. In 2009, Mexico
was Western Union’s sixth highest payout destination, with 1,626 complaints
totaling over $2.1 million. Since 2011, it has consistently been in the top
three destination countries for reported fraud payouts from U.S. consumers, and
the top payout destination for fraud related to emergency scams. In 2011,
Western Union received at least 2,824 emergency scam complaints on transfers
paid out in Mexico. The total amount paid out on these transfers was $6,908,666,
and the average payout was $2,446. Of those victims who reported their date of
birth, nearly 70% were 65 years or older at the time they sent their money
transfers. Although Western Union has at least three master agents in Mexico,
internal reports and records show that one master agent, Elektra, has been
responsible for paying out most of the emergency scam complaints. Of the
reported emergency scam transfers paid out in Mexico between 2011 and 2014,
Elektra agents were responsible for payouts relating to at least 7,107
complaints totaling $12,494,602, or 88% of the total reported losses. During
that same period, nineteen Elektra agents paid out $6,425,782 in reported
emergency fraud, including one agent discussed further below that alone paid out
over $1.4 million in reported fraud. Nevertheless, and despite repeated reviews
and investigations of agent locations in Mexico, as of October 2015, Western
Union had rarely, if ever, terminated agent
locations in Mexico for consumer fraud, even in instances where particular agent
locations repeatedly appeared on fraud reports, or had confirmed and potential
fraud amounting to more than 25%, or even 50%, of their payouts.



45. By 2010, internal reports
and records show that Western Union was aware of a substantial increase in fraud
complaints involving money transfers sent to Spain, and that particular agents
there had very high levels of fraud and questionable activity. From 2009 to
2010, the number of complaints paid out in Spain increased from 583 to 2,195,
and the reported fraud amount rose from over $1.1 million to over $5.3 million.
Indeed, from 2010 to 2012, Spain was the third highest payout country by amount
for complained-of transfers, trailing only the United States and the UK. During
that time, Western Union received at least 8,086 complaints about transfers paid
out in Spain, totaling over $17 million. From 2007 to 2012, a subset of 61
agents in Spain paid out over $11.9 million in reported fraud. Western Union’s
internal reports and records document numerous instances of suspicious activity
by these agents, including flipping and sending money transfers to high-risk
countries. The reported fraud paid out by agents in Spain, moreover, likely
grossly understates the actual fraud. For example, 20 agents in Spain that were
responsible for over $5.7 million in reported fraud received more than $51.6
million during the period those agents were receiving fraud complaints, of which over $22.7 million came from U.S.
consumers. During that time, those 20 agents were responsible for sending over
$8.8 million to Nigeria, over $3.7 million to Canada, over $1.7 million to
Romania, and over $800,000 to Ghana, which are all high-risk fraud countries.
Although Western Union was aware of problematic agent locations in Spain, it
failed to promptly suspend and terminate those agent locations.


22







46. Prior to 2011, Western
Union received a small number of complaints each year involving its Peruvian
agents. For example, in 2010, Western Union recorded only 71 fraud reports
against agents in Peru totaling $38,492. In 2011, however, there was a dramatic
spike in complaints about money transfers paid out in Peru, especially about
emergency scams, with Western Union receiving at least 692 complaints totaling
$2,218,761. The average transfer amount in the complained-of transactions jumped
from $542 to $3,206. In 2012, the numbers increased to 1,003 fraud complaints
totaling $1,944,730. Over 96% of the complained-of transfers paid out in Peru in
2011 and 2012 originated from the United States. Between 2011 and 2012, thirteen
Peruvian agents paid out $3,603,539 in reported fraud, and together were
responsible for nearly 87% of the total reported fraud payouts in Peru for those
years. Internal reports and records show that Western Union was aware of the
dramatic increase in complaints, as well as particular Peruvian agent locations
that were responsible for paying out most of
the reported fraud. Despite its awareness, Western Union failed to terminate
problematic agent locations until after law enforcement began to inquire and
raise concerns about the fraud, and even then, one agent location terminated for
consumer fraud was reactivated under a different agent ID. In recent years,
Western Union has continued to receive complaints from U.S. consumers concerning
high-dollar emergency scam-related money transfers paid out at agent locations
in Peru. 

47. For many years, Nigerian
scammers have been at the center of many international frauds. Although Western
Union’s agent locations in Nigeria are in banks, those bank locations, too, have
paid out large numbers of fraud-induced money transfers and engaged in other
suspicious activities. According to Western Union’s records, Nigeria has been
the fourth highest payout destination for fraud complaints received by Western
Union since 2006. Since then, Western Union has received complaints about at
least 48,047 money transfers paid out in Nigeria, totaling over $38.2 million.
Approximately 86.7% of the complained-of transfers originated from the United
States. During this period, a subset of 68 Western Union agent locations in
Nigeria was responsible for at least 17,743 complaints totaling over $16.6
million in reported fraud. Based on the complaints, reported fraud is typically
paid out at various locations of two large banks in Nigeria. Overall, one of
those banks has at least 15,184 complaints totaling $11,292,195, while the other has at least 10,948 complaints
totaling $8,167,769. Individual locations of the two banks also have amassed
huge numbers of complaints. One location alone was responsible for at least 832
complaints totaling $1,407,252, while another was responsible for at least 1,741
complaints totaling $1,187,141. Despite repeated reviews and investigations of
agent locations in Nigeria, as of October 2015, Western Union had rarely, if
ever, terminated agent locations in Nigeria for consumer fraud.


23







48. Over the years, agent
locations in many other countries have appeared on Western Union’s fraud
reports, and have been reviewed by the company for fraud. Those countries
include, but are not limited to, Ghana, the Philippines, Bolivia, China,
Malaysia, the Dominican Republic, Greece, and Thailand. Some of those agent
locations continue to operate despite having high levels of fraud, while others
have been suspended or terminated, but only after having caused substantial
injury to consumers over many months or, in some cases, years. 

Government Agencies
Worldwide Warned Western Union
about Consumer Fraud Involving Its System

49. In addition to consumer
complaints and Western Union’s internal reports and records, Western Union’s
awareness of the consumer fraud problem with its money transfer system is
further demonstrated by the fact that law enforcement agencies in the United
States and throughout the world have warned the company for many years that its
money transfer system was being used to perpetrate consumer frauds,
and that Western Union was not adequately addressing  the problem. 

50. First, in or around 2002,
multiple state Attorneys General issued subpoenas to Western Union in
conjunction with their investigations of the use of Western Union’s money
transfer system by fraudulent telemarketers. In correspondence dated October 1,
2002, the Vermont Attorney General’s Office informed Western Union about
disturbing statistics regarding telemarketers in Quebec, Ontario, British
Columbia, and Israel misusing Western Union’s money transfer system for frauds.


24














51. In or around November
2005, Western Union entered into an agreement with forty-seven states and the
District of Columbia involving the use of Western Union’s money transfer system
by “fraudulent telemarketers in and outside the United States” (“2005
Agreement”). The 2005 Agreement imposed a number of requirements upon Western
Union, including warnings to consumers, agent training, closure of agents,
development of a computerized system to identify likely fraud, and increasing
anti-fraud staff. For example, the 2005 Agreement required that Western Union
“terminate those of its agents, subagents or locations, as the case may be, who
are complicit in fraud-induced transfers or who knowingly ignore such fraud, or,
if certain employees of the agent or subagent are the complicit or knowingly
ignoring parties, insist upon termination of such employees as a condition to
continued agent or subagent status.” The 2005 Agreement was in effect for five
years. Despite this agreement, as explained below, Western Union in many
instances failed to terminate many problematic agent locations, especially in
countries outside of the United States and Canada. 


52. In October 2009, the FTC
announced that it had reached a settlement with MoneyGram International, Inc.
(“MoneyGram”), Western Union’s main competitor, relating to charges that the
company had allowed its money transfer system to be used for fraud. The FTC
publicly released copies of the complaint and order against MoneyGram, which
required, among other things, the termination of any agent that “may be
complicit in” fraud. Following the FTC’s settlement with MoneyGram, FTC staff
sent a letter to Western Union in November 2009 expressing concern about the
“huge volume of fraud that employs money transfer services,” like that of
Western Union.

53. According to Western
Union’s records, in or around September 2010, the Japan Financial Services
Agency expressed concerns about Japanese consumers sending fraud-induced money
transfers to the UK, and “suspicious viewing/surfing of transactions in the
United Kingdom, resulting in either Paid in Error (PIE) or Non Payment Claims
[complaints about money transfers being paid to the wrong person or not being
paid].” 

25







54. Since at least June 2011,
the Minnesota Attorney General’s Office has been warning Western Union in
correspondence directed to the attention of the President and Chief Executive
Officer that “each year thousands of consumers are defrauded through use of your
company’s services,” and that “[g]iven your firm’s apparently continuing
inability or unwillingness to detect and prevent such wire transfer fraud, it
would seem appropriate to” issue refunds to consumers. This correspondence has
routinely described the consumer complaints the Minnesota Attorney General has
received from fraud victims. In response, Western Union typically has refused to
issue any refunds to the victims after the funds were paid out. 

55. In or around October 2011,
multiple state Attorneys General issued subpoenas to Western Union in connection
with investigations of fraudulent telemarketers’ use of Western Union’s money
transfer system. The subpoena issued by Vermont stated that it had “reason to
believe that Western Union has provided substantial assistance to fraudulent
telemarketers in the form of access to its money transfer system, despite
knowing, or consciously avoiding knowing, of the fraud, in violation of the
Vermont Consumer Fraud Act, 9 V.S.A. § 2453(a).”


56. On or about November 29,
2011, Western Union personnel met with the Korea Financial Supervisory Services
to discuss the regulator’s concerns about consumer fraud involving Western
Union’s money transfer system and its requirement that Western Union put
together a plan to alleviate consumer fraud. 

26







57. In February 2012, in
response to a survey sent to law enforcement by Western Union, a Special Agent
for the U.S. Secret Service warned Western Union of the following: that its
services were “widely used by Nigerian scammers and other criminal elements
overseas”; “a person in America can easily be robbed by someone in a foreign
country and there is almost no possibility to recover that fraud loss”; its
“services are widely used for online scams in the US”; and that Western Union
“is a complete and almost total safe haven for the criminal element to freely
launder illegal proceeds without detection.” 

58. According to Western
Union’s records, by the first quarter of 2012, the Serious Organised Crime
Agency (“SOCA”) in the United Kingdom, presently known as the National Crime
Agency, disclosed to Western Union that in relation to an “investigation
conducted on money remitters in Western England,” SOCA had “surveyed Western
Union customers and found that 81% of the transactions paid in Nigeria or Ghana
were allegedly fraud related.” 

59. In or around late May
2012, the Toronto Police Service sent Western Union a letter alerting the
company that it “may have aided individuals with the criminal offense of
laundering [the] proceeds of crime” from consumer frauds, and cautioning that it
needed to take “the appropriate steps . . . to ensure that Western Union is not
a party to this serious criminal offense, whether intentionally or willfully
blind to its role.” In numerous additional instances, the Toronto Police Service
emailed Western Union information about other fraud-induced money transfers and
the names of individuals who had collected the transfers, telling the company to
consider the emails a formal caution that allowing the individuals to collect
future transfers could be considered “aiding the criminal offence of Laundering
the Proceeds of Crime.” 

27








60. In or around October 2012,
Western Union received a letter from SEPBLAC, Spain’s Financial Intelligence
Unit and Anti-Money Laundering/Counter Financing of Terrorism Supervisory
Authority, informing Western Union that an inspection had revealed “extremely
serious facts,” which required WUPSIL to “adopt urgent measures in order to
correct them immediately,” and that the operations of a “significant part of”
Western Union’s agents in two networks owned by Western Union “are related to
fraud and money laundering.” 

DESPITE AWARENESS OF
THE FRAUD,
WESTERN UNION HAS CONTINUED TO
PROVIDE
SUBSTANTIAL
ASSISTANCE OR SUPPORT TO CONSUMER FRAUDS

61. Since at least January
2004, and continuing thereafter, Western Union has been aware that perpetrators
of frauds have used its money transfer system to obtain funds from their
victims, and for many years has knowingly, or with conscious avoidance of
knowledge, provided substantial assistance or support to fraudulent
telemarketers and con artists.

62. In some cases, Western
Union’s agents, subagents, or FLAs have been complicit, or sometimes even
participated, in the frauds. In other cases, Western Union’s agents, subagents,
or FLAs have offered substantial assistance or support to the frauds by paying
out funds in violation of Western Union’s own policies and procedures.


28








63. Western Union has provided
an essential service to these fraudulent telemarketers, sellers, and con artists
by permitting them access to Western Union’s money transfer system. Exploiting
this access to its full potential, telemarketing, mass marketing, and imposter
scams have received, and continue to receive, millions of dollars from
victimized consumers, while generating substantial revenue for Western Union
from transaction fees and foreign currency exchange fees.

64. For many years, Western
Union has failed to: (a) promptly investigate, suspend, and terminate
potentially complicit agents and subagents, or agents and subagents that have
failed to comply with Western Union’s anti-fraud and/or AML policies and
procedures; (b) conduct adequate due diligence on prospective and existing
agents and subagents; (c) effectively train, monitor, and review its agents,
subagents, and FLAs; (d) adequately collect, record, and report consumer fraud
involving its money transfer system; and (e) take other reasonable steps to
prevent fraudulent telemarketers, sellers, and con artists from using Western
Union’s money transfer system to perpetrate their frauds. 

65. In numerous instances,
Western Union has failed to take timely, appropriate, and effective measures to
mitigate fraud in connection with its processing of money transfers sent by
consumers despite knowledge, or conscious avoidance of knowledge, that:
fraudulent telemarketers, sellers, and con artists have extensively accessed and
exploited Western Union’s money transfer system; Western Union’s money transfer
system has played an integral role in the scams; and a number of its agents have
been complicit, or involved, in the frauds, or have failed to adhere to Western
Union’s policies and procedures to detect and prevent fraud. 

29








Western Union Has Failed to
Promptly Investigate, Suspend, 

and Terminate Agents with High Levels of Consumer
Fraud 

66. Despite Western Union’s
awareness of consumer fraud involving its system, Western Union has in many
instances failed to promptly investigate, suspend, and terminate agents and
subagents that have exhibited high levels of consumer fraud, some of which were
likely complicit in frauds, or which have ignored such frauds by failing to
comply with Western Union’s policies and procedures, thereby causing significant
and ongoing harm to consumers. 



67. Even though Western
Union’s internal reports have identified agent locations where 5% to over 75% of
the transactions (in volume or amount) constituted confirmed and potential
fraud, and/or suspicious activities, such as surfing, flipping, and data
integrity issues, Western Union has allowed many of these agents and subagents
to continue operating, with only temporary suspensions, if any. In many cases,
Western Union has simply “escalated,” or referred, such agents for further
review or investigation, but the investigations often have been delayed for
months, and in many instances, the escalations have failed to resolve the
problems. Western Union frequently has relied on its master agents to conduct
their own investigations of their subagents and locations, but has failed to
ensure that the master agents’ investigations are adequate. Western Union also
has sometimes repeatedly escalated the same agents for review or investigation
without suspending or eventually terminating those agents even while the agent
has continued to be the subject of fraud complaints. Western Union has sometimes
even disregarded recommendations from its employees to suspend or terminate
certain agents or subagents due to serious consumer fraud problems. 

68. Western Union has
permitted agents and subagents that have processed hundreds of thousands of
dollars, or even millions of dollars, in confirmed and potential fraud to
continue operating for months or even years despite highly suspicious activities
and indications of complicity. For example, one agent location in Spain, Locutorio Okuns, operated from 2005 until at
least 2012. During that time, the agent engaged in highly suspicious activity,
including making payouts related to 126 complaints totaling at least $341,771 in
reported fraud, and receiving over $1 million from the United States in money
transfers that had characteristics indicative of fraud, such as unusually
high-dollar amounts and serious data integrity issues. The agent also displayed
highly suspicious spikes in volume that corresponded with spikes in fraud
complaints. Although it was reviewed by Western Union at least five times, the
agent was permitted to continue to operate for years, and its owner was
ultimately one of the individuals arrested by the Spanish police in 2014, as
described above. Another agent location in the UK, S S Newsagent, made payouts
relating to at least 347 complaints totaling $924,695 in reported fraud between
2005 and 2012. That agent received over $2.7 million in money transfers from the
United States, including over $1 million in 2007 alone, and the majority of
those transactions had characteristics indicative of fraud, including unusually
high-dollar amounts and data integrity issues. Even though the agent was
reviewed multiple times, it was not terminated despite its history as a
high-fraud agent.

30







69. Even in instances where
Western Union has suspended high-fraud agents after a few months rather than
years, the agents often have generated significant consumer losses that Western
Union could have prevented by acting more quickly. These agents frequently are immediately identifiable based
on spikes in fraud complaints during the first problematic month. For example,
during a 30-day period beginning in December 2011, Western Union received 54
complaints, totaling $246,746, concerning money transfers paid out at one agent
location in Bolivia. This location had a Nigerian owner and had already been
reviewed by Western Union in the past due to suspicious activity involving
millions of dollars in payouts from China. Western Union failed to promptly
suspend the agent and during a roughly four-month period from December 2011 to
April 2012, it was responsible for paying out at least 191 transfers associated
with fraud complaints totaling $825,319. The average reported fraud transfer was
$4,321, and all of the complaints involved U.S. senders who were the victims of
emergency scams. Although this agent was suspended in July 2012, it had paid out
over $2.5 million in suspected fraud in just over four months before Western
Union took action. 

70. In instances where Western
Union suspended agents or subagents due to consumer fraud, the suspensions often
were only temporary, even in high-risk fraud countries, such as Nigeria, Ghana,
and Jamaica. For example, in or around 2012, Western Union identified and
suspended 13 agent locations in Montego Bay, Jamaica, that had been processing
millions of dollars of fraudulent and potentially fraudulent money transfers
related to lottery/sweepstakes fraud. The suspensions only lasted a short time,
however, before the agents were reactivated. After being reactivated, ten of
those agents have continued to pay out tens to hundreds of reported fraud
complaints each year since 2013, and in that span have been the subject of 2,055
complaints totaling $737,319. 








71. In some instances,
reactivated agents or subagents were assigned new agent ID numbers or became
subagents in different agent networks. For example, Western Union’s top fraud
payout agent in Mexico made payouts relating to at least 410 complaints totaling
over $1.4 million in reported fraud between March 2011 and July 2012. Western
Union finally suspended the location in July 2012, but one month later, the same
agent began to operate again under a new agent ID, and it continued generating
fraud complaints. In addition, Western Union even reactivated some agents that
had been terminated due to consumer fraud.

72. Western Union’s general
practice has been to attempt to rehabilitate agents and subagents exhibiting
high levels of consumer fraud by requiring its agents to implement “action
plans” to address the problems, but this practice has been inadequate and
ineffective. In many instances, Western Union or its agents have failed to
create action plans that effectively address consumer fraud. The action plans
also often do not adequately and effectively address problems with agents,
subagents, and FLAs who are potentially complicit and/or have engaged in
suspicious activities. For example, the action plans frequently call for the
training of agent locations and FLAs even though Western Union has acknowledged
that “identifying and eliminating complicit actors from the system is more
effective at combating consumer fraud than training.” In other instances,
Western Union or its agents have failed to create any action plan or for months
have delayed creating action plans. Even after action plans have been created,
in some cases, the agents and subagents have resisted implementing them, failed
to do so satisfactorily, or even ignored them. 


73. For many years,
suspensions and/or terminations were typically limited to agents in the United
States and Canada. For example, between January 1, 2006 and November 1, 2010,
Western Union failed to terminate many problematic agent locations worldwide
that had paid out $100,000 or more in reported fraud, including in the UK (124
agents), Nigeria (56 agents), Ghana (18 agents), Jamaica and Spain (16 agents
each). In fact, two UK agents each were responsible for paying out over $2
million in reported fraud between January 1, 2006 and November 1, 2010.
Moreover, as of October 2015, Western Union had rarely, if ever, terminated
agent locations for fraud in certain high-risk countries, including, but not
limited to, Mexico, Nigeria, Ghana, the Dominican Republic, China, and Haiti,
despite high levels of fraud and indications of complicity at agent
locations.


31










Western Union Has Failed to
Conduct Adequate Due Diligence on Agents 

74. For many years, Western
Union has failed to conduct adequate due diligence on its prospective agents and
subagents, as well as those agents and subagents whose contracts come up for
renewal. Western Union either has not conducted background checks on many of its
agents and subagents, or to the extent background checks have been conducted,
they often have been inadequate. It also has, in many instances, failed to
maintain records demonstrating that it has conducted such background checks. In
addition, despite awareness of problems with FLAs, Western Union does not
conduct any due diligence on, and frequently knows little about, its agents’ and
subagents’ FLAs. 

75. For many years, Western
Union has failed to conduct routine background checks of each of its prospective
and existing agents and subagents located around the world. Even though Western
Union’s agreements provide it with the authority to conduct background checks on
its agents or subagents at any time, Western Union’s practice in many countries
has been to rely on its agents to conduct due diligence on their own subagents
and FLAs, rather than conduct its own background checks, including of subagents
operating in high-risk fraud countries. In some instances, Western Union has
approved agents or allowed existing agents to continue operating without even
knowing the identities of all individuals with ownership, or beneficial
ownership, interests in the agent. In other instances, Western Union has not
known, and has not required its agents to disclose or update, the identities of all of its subagents or
FLAs.


76. In numerous instances,
background checks conducted by Western Union have not been thorough, consisting
only of collecting limited information and conducting some type of credit or
financial check, rather than criminal background checks of its agents and
subagents. In many cases, Western Union has relied upon inaccurate, incomplete,
or false information provided by agents and has failed to verify the accuracy of
information provided by applicants. Western Union also has installed agents or
subagents with criminal histories, including felonies and misdemeanors involving
dishonesty, as well as histories of investigations and lawsuits involving
allegations of fraud. For many years, the department at Western Union primarily
responsible for conducting background checks has not been provided with
sufficient information to conduct thorough background checks of every
prospective and existing agent and subagent, such as information from law
enforcement, information about investigations of agent locations, and access to
consumer complaints. 


77. In some cases, Western
Union has installed agents or subagents that it had previously terminated, that
were previously suspended or terminated by MoneyGram for fraud, or that were
concurrently operating as MoneyGram agents (in violation of Western Union’s
agent agreements). One Western Union agent in College Park, Georgia, for example, was suspended
in 2006 due to consumer fraud, but began operating again in 2007 from the same
address, but with a different business name and agent ID number, until it was
suspended for fraud again. The agent then became a MoneyGram agent and continued
to generate fraud-induced money transfers for approximately one year before
being terminated by MoneyGram. After that, the agent returned to Western Union
in 2009, and began operating for a third time with the same name and at the same
location. A review in 2012 revealed that approximately 80% of its payouts were
attributable to fraud, and it was later terminated. In 2015, the agent began
operating again as a Western Union agent from the same address, using a similar
name, but with a new agent ID number, and once again, it began generating fraud
complaints. 

78. Western Union’s background
checks also have failed to prevent previously terminated agents or subagents
from using straw men to become agents or owners again to gain access to Western
Union’s money transfer system. In addition, Western Union has installed as
agents or subagents individuals who had previously been interdicted
(i.e., blocked from using Western Union’s money
transfer system) due to suspicious activities, or were former FLAs at agent
locations that were suspended or terminated for fraud. For example, after
suspending an agent location in the Philippines due to high levels of fraud,
Western Union discovered that the owner of the location had been a high-volume
sender to Nigeria who Western Union had interdicted just two months before the
location began operating. During the three-month period before the agent
location was suspended, it generated at least 173 fraud complaints totaling
$316,400, and paid out over $1.2 million in suspected fraud. 

32







Western Union Has Failed to
Effectively Train, Monitor, and Review Agents 

79. For many years, Western
Union has failed to effectively train, monitor, and review its agents,
subagents, and FLAs to detect and prevent consumer fraud and to prevent
potential complicity at agent locations. 

80. For many years, Western
Union has provided only limited training to agents and subagents with respect to
detecting and preventing consumer fraud, and its training overall has been
inadequate and ineffective. In many instances, FLAs responsible for processing
fraud-induced money transfers at Western Union’s agent locations have not been
knowledgeable about Western Union’s anti-fraud and/or AML policies and
procedures, including with respect to detecting and preventing fraud, properly
recording customers’ biographical information and IDs, and addressing suspicious
activities. Western Union also has not had an adequate and effective system in
place to ensure that FLAs are knowledgeable in these areas. As a result, in many
instances, Western Union’s high-fraud agent locations have violated the
company’s policies and procedures by failing to collect proper IDs or
biographical information from recipients of money transfers, accepting improper
forms of IDs, or recording obviously incorrect or fictitious ID information into Western Union’s system.



81. Western Union’s complaint
database shows that its agent locations that have paid out fraud-induced money
transfers frequently have permitted fraudsters to pick up money transfers using
fake IDs, or without recording IDs or other required information. For example,
in many instances, these agent locations have recorded the same IDs for multiple
recipients, or different IDs for the same recipients. In addition, for tens of
thousands of fraud-induced money transfers, Western Union’s records frequently
show no birthdates, or facially invalid birthdates, such as “1/1/1900,” for the
recipients. Western Union’s records also show that its agent locations have paid
out at least 32,764 money transfers of $1,000 or more that consumers reported as
fraudulent from 2004 through August 2015 without recording any ID information
for the recipients. 

82. In addition, despite
Western Union’s 2005 Agreement with the States, which required Western Union to
“commence a program of person-to-person or telephone training at agent locations
known to have a materially elevated level of outgoing or incoming fraud-induced
transfers sent from the United States to anywhere except Mexico,” in many cases,
and especially with respect to foreign agents and subagents, Western Union
failed to comply with this requirement. For example, with respect to many of its
foreign agent locations that have exhibited high fraud levels, Western Union’s
practice was only to train the master agents and not to conduct person-to-person
or telephone training at the agent locations that exhibited high levels of
fraud. 

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83. For many years, Western
Union has failed to adequately monitor its agents’ activity for fraud. In many
instances, Western Union employees responsible for monitoring the activities of
agent locations have not been provided with sufficient information or resources
to adequately monitor Western Union’s agents, subagents, and FLAs. For example,
in some instances, Western Union has assigned more than one agent ID number to a
single agent or subagent without providing Western Union employees with the
means to easily locate all of the agent’s or subagent’s ID numbers in Western
Union’s system. Western Union has similarly failed to provide its employees with
the means to easily identify agents or subagents with common ownership. In
addition, in some cases, Western Union’s employees have been unable to identify
problematic FLAs because FLAs have not used unique IDs when processing money
transfers. Western Union’s employees also sometimes have not had complete and
historical information about particular agents and subagents, including
information about all fraud complaints, prior reviews, investigations, and
internal reports related to fraud, as well as transactional activity. Therefore,
Western Union employees responsible for monitoring agent activity may not have
been aware of all relevant information. 


84. Western Union has failed
to conduct adequate and routine onsite compliance reviews of its agent locations
worldwide. Western Union often has relied on its master agents to conduct
reviews, but has failed to ensure that those master agents are conducting
adequate and effective oversight of their subagents and locations. In some
cases, those agents have not even allowed Western Union employees to visit
locations without them being present. In other cases, Western Union’s employees
have not been able to conduct independent onsite reviews of certain locations
because they were in areas considered too dangerous to visit. Western Union also
has failed to conduct adequate and routine onsite reviews of many of its
independent agents. 

85. For many years, consumer
fraud was not even routinely addressed in compliance reviews of agents. Even
after it was added to the list of topics for these reviews, consumer fraud for
many years was addressed only in a cursory manner. In addition, in many
instances, Western Union employees who conduct compliance reviews have not been
provided with information about fraud complaints received involving the agents
being reviewed, so the employees could not adequately address issues related to
the complaints in their reviews. 

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Western Union Has Failed to
Adequately Collect, Record, 

and Report Consumer Fraud Involving Its Money
Transfer System 

86. Since at least January
2004, Western Union has maintained a complaint database, which contains
information relating to complaints or reports the company receives about
fraud-induced money transfers. 

87. The information contained
in Western Union’s complaint database significantly understates the number of
actual fraud-induced money transfers and losses reported to the company. Despite
receiving information from consumers, their family members, or law enforcement
representatives about fraud-induced money transfers, Western Union often has
failed to record information about all of those money transfers in its complaint
database. In other instances, Western Union has failed to record in its database
any of the victims’ fraud-induced money transfers. 

88. Up until in or around
December 2011, Western Union did not provide any toll-free number that consumers
in countries other than the United States and Canada could use to report fraud
and to try to stop the payout of a fraud-induced money transfer. For example,
Western Union did not provide fraud hotlines for consumers in Germany, Mexico,
Spain, and the UK until December 2011, for consumers in Australia, Japan, and
Malaysia until February 2012, and for consumers in Austria, Belgium, Luxembourg,
and Switzerland until August 2012.

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89. Western Union uses the
information in its complaint database to administer its anti-fraud program, so
it is important that the database be accurate and complete. For example, Western
Union uses this information to: (a) monitor and identify agents, subagents, and
FLAs that may be complicit in frauds; (b) create automated rules regarding
particular corridors (e.g., limiting the number
and amount of money transfers to receivers); and (c) interdict individuals who
are the victims or the perpetrators of frauds. Therefore, Western Union’s
failure to keep accurate and complete records of fraud-induced money transfers
has impeded its efforts to detect and prevent consumer fraud. 

90. Although Western Union
employees have brought the underreporting of fraud-induced money transfers in
the company’s complaint database to the attention of those responsible for
maintaining the database, Western Union has failed to take adequate corrective
action, if any, to address the problem. 

91. Although the Financial
Crime Enforcement Network (“FinCEN”), the primary administrator of the BSA,
requires money services businesses like Western Union to file Suspicious
Activity Reports (“SARs”) relating to fraud, Western Union has, in many cases,
failed to file SARS on, and identify as the subject of SARS, particular agent
locations in foreign countries that have processed high levels of fraud-induced
money transfers sent by U.S. consumers and exhibited other suspicious
activities. 

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Western Union Has Failed
to Take Other Reasonable Measures to
Mitigate Fraud in Connection With Its
Processing of Money Transfers

92. For many years, Western
Union has failed to take other reasonable measures to mitigate fraud in
connection with its processing of money transfers, ignoring in some instances
useful suggestions and recommendations from its employees and representatives of
law enforcement agencies. These types of measures include, but are not limited
to, the following: bolstering its ID requirements for sending or receiving money
transfers, such as by imposing more robust ID requirements; requiring the
collection of additional biographical information; implementing more controls
for noncompliant transactions or potentially fraud-induced money transfers,
including, but not limited to, transactions with data integrity issues and to
high-risk countries; improving the company’s handling of, and ability to
receive, complaints about fraud worldwide; and improving its interdiction system
to be more effective in blocking money transfers associated with consumer fraud,
including, but not limited to, by permanently blocking payouts to the recipients
of fraud-induced money transfers. 

93. Western Union has made it
difficult for employees to take meaningful action to detect and prevent consumer
fraud, including by failing to provide employees with sufficient information or
resources, including complete records of consumer fraud complaints, as well as
information about law enforcement contacts, investigations, and actions. For
many years, departments within Western Union
responsible for handling consumer fraud issues did not routinely share
consumer fraud information with other
groups or departments. 


94. Although Western Union
relies on its agents to comply with Western Union’s anti-fraud and AML programs,
and to oversee the activity of their own subagents, locations, and FLAs, it
often fails to provide its agents with the information necessary to conduct
effective fraud reviews and to detect and prevent consumer fraud, including the
potential complicity of particular agent locations and FLAs. For example,
Western Union typically does not share with the agents themselves complaints it
has received about fraud-induced money transfers processed by the agent
locations or FLAs. Therefore, despite being tasked with overseeing the conduct
of their own subagents, locations, and FLAs, Western Union’s agents in many
cases are unaware of the nature, details, history, and volume of complaints
involving the agent locations and FLAs. 

95. Western Union and its
agents also have failed to provide adequate and effective warnings to consumers
about the fraud occurring through its money transfer system. Although Western
Union provides some warnings on the first page of send forms located at some of
its agent locations, in many cases, these warnings are not clear and conspicuous
to many consumers. In addition, Western Union’s agent locations have failed to
provide routine verbal warnings to consumers before they initiated money
transfers, even in instances where consumers’ money transfers have displayed obvious signs of fraud, such as
high-dollar money transfers by elderly consumers to countries known for fraud.
Therefore, consumers often have been unaware of the risks associated with
sending money through Western Union’s money transfer system. 

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WESTERN UNION HAS FOR
MANY YEARS FAILED
TO MAKE
EFFECTIVE CHANGES TO PREVENT FRAUD

96. Even after January 2011,
when Western Union claimed in a written report to have implemented “a
comprehensive anti-fraud program” to protect consumers, Western Union still
failed to adopt an adequate and effective anti-fraud program. Although as a
result of the FTC’s investigation, Western Union has improved aspects of its
anti-fraud program since 2012, the company still failed in certain cases to
promptly terminate agents around the world that appeared to be complicit in
paying out the fraud-induced money transfers, including numerous agents in Spain
that operated between January 2011 and December 2012, and were arrested by the
Spanish police in 2014 for their role in laundering large sums of money received
from the fraud victims. As of October 2015, Western Union had rarely, if ever,
terminated agent locations for fraud in certain high-risk countries, including,
but not limited to, Mexico, Nigeria, Ghana, the Dominican Republic, China, and
Haiti, despite high levels of fraud and indications of complicity at agent
locations. 

97. In numerous instances,
Western Union has permitted agent locations to continue operating for months or
years despite high levels of fraud and other suspicious activities. For example,
from July 2009 to as recently as August 2015, an agent location in Malaysia made
payouts relating to at least 252 fraud complaints totaling $389,061. Although
the agent appeared on fraud reports and was reviewed for fraud many times
between 2010 and 2014, the agent has not been terminated. In fact, in 2014,
company executives approved the reactivation of that agent despite being
informed that confirmed and potential fraud, as well as suspicious activity,
amounted to approximately 54% of the agent’s pay volume. An agent location in
Greece made payouts relating to at least 106 fraud complaints totaling $193,696
from July 2013 to October 2014. From 2012 to 2014, the agent paid out $5.4
million in money transfers, of which approximately $3.7 million were for $1,000
or more. That agent operated for over two years despite appearing on internal
fraud or agent complicity index reports multiple times and being reviewed for
fraud at least three times with findings of suspicious activities. From
September 2013 to August 2015, an agent in Thailand paid out money transfers
associated with at least 1,197 complaints totaling $425,409, of which 336
complaints totaling $117,290 were paid out in April 2015 alone. That agent was
allowed to continue operating, despite a review in 2013 finding that 63% of the
agent’s transactions in two months amounted to confirmed fraud and questionable
activity, and a review in 2015 associated
with three of its agent ID numbers finding that 25% of its activity in one
month, amounting to over $1.2 million, was connected to fraud.


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VIOLATIONS OF THE FTC
ACT 

98. Section 5(a) of the FTC
Act, 15 U.S.C. § 45(a), prohibits “unfair” or “deceptive” acts and practices in
or affecting commerce, including acts or practices involving foreign commerce
that “cause or are likely to cause reasonably foreseeable injury within the
United States” or “involve material conduct occurring within the United
States.”

99. Acts or practices are
unfair under Section 5 of the FTC Act if they cause substantial injury to
consumers that consumers cannot reasonably avoid themselves and that is not
outweighed by countervailing benefits to consumers or competition. 15 U.S.C. §
45(n). 

COUNT I 

Unfair Acts or
Practices 

100. In numerous instances, in
operating its worldwide money transfer system, Defendant has failed to take
timely, appropriate, and effective action to detect and prevent fraud-induced
money transfers through Defendant’s system, as described above. 

101. Defendant’s actions cause
or are likely to cause substantial injury to consumers that consumers cannot
reasonably avoid themselves and that is not outweighed by countervailing
benefits to consumers or competition. 

102. Therefore, Defendant’s
practices as described in Paragraph 100 above constitute unfair acts or
practices in violation of Section 5 of the FTC Act, 15 U.S.C. §§ 45(a) and
45(n). 

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THE
TSR 

103. Congress directed the FTC
to prescribe rules prohibiting abusive and deceptive telemarketing acts or
practices pursuant to the Telemarketing Act, 15 U.S.C. §§ 6101-6108. The FTC
adopted the original TSR in 1995, extensively amended it in 2003, and amended
certain provisions thereafter. 16 C.F.R. Part 310. 

104. Defendant, its agents, or
subagents have processed money transfers and provided related services on behalf
of persons who are “sellers” or “telemarketers” engaged in “telemarketing,” as
those terms are defined in Sections 310.2 (dd), (ff), and (gg) of the
TSR.

105. The TSR prohibits
telemarketers and sellers from making a false or misleading statement to induce
any person to pay for goods or services. 16 C.F.R. § 310.3(a)(4). 


106. The TSR also prohibits
telemarketers and sellers from, among other things, requesting or receiving
payment of any fee or consideration in advance of obtaining a loan or other
extension of credit when the seller or telemarketer has guaranteed or
represented a high likelihood of success in obtaining or arranging a loan or
other extension of credit. 16 C.F.R. § 310.4(a)(4).

107. It is a violation of the
TSR for any person to provide “substantial assistance or support” to any seller
or telemarketer when that person “knows or consciously avoids knowing” that the
seller or telemarketer is engaged in any act or practice that violates Sections
310.3(a), (c), or (d), or 310.4 of the TSR. 16 C.F.R. § 310.3(b).

108. On December 14, 2015, the
FTC published a notice that it had adopted amendments to the TSR, including a
prohibition against using “cash-to-cash” money transfers for outbound and
inbound telemarketing transactions. 80 Fed. Reg. 77520 (Dec. 14, 2015). This
prohibition became effective on June 13, 2016. 

109. Pursuant to Section 3(c)
of the Telemarketing Act, 15 U.S.C. §
6102(c), and Section 18(d)(3) of the FTC Act, 15 U.S.C. § 57a(d)(3), a violation
of the TSR constitutes an unfair or deceptive act or practice in or affecting
commerce, in violation of Section 5(a) of the FTC Act, 15 U.S.C. § 45(a).


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VIOLATIONS OF THE
TSR

COUNT
II

Assisting and
Facilitating TSR Violations 

110. In numerous instances, in
the course of processing money transfers, Defendant, its agents, or subagents
have provided substantial assistance or support to sellers or telemarketers who
Defendant or its agents or subagents knew or consciously avoided
knowing:

a. Induced consumers to pay
for goods and services through the use of false or misleading statements,
including, without limitation, the statement that the consumer has won and will
receive a large cash award if the consumer pays a requested fee or fees, in
violation of Section 310.3(a)(4) of the TSR, 16 C.F.R. § 310.3(a)(4);
and

b. Requested or received
payment of a fee or consideration in advance of consumers obtaining a loan when
the seller or telemarketer has guaranteed or represented a high likelihood of
success in obtaining or arranging a loan for a person in violation of Section
310.4(a)(4) of the TSR. 

111. Defendant’s acts or
practices, as described in Paragraph 110 above, constitute deceptive
telemarketing acts or practices that violate the TSR, 16 C.F.R. §310.3(b).


41








CONSUMER
INJURY 

112. Consumers have suffered
and will continue to suffer substantial injury as a result of Defendant’s
violations of the FTC Act and the TSR. In addition, Defendant has been unjustly
enriched as a result of its unlawful acts or practices. Absent injunctive relief
by this Court, Defendant is likely to continue to injure consumers, reap unjust
enrichment, and harm the public interest. 

THIS COURT’S POWER TO
GRANT RELIEF


113. Section 13(b) of the FTC
Act, 15 U.S.C. § 53(b), empowers this Court to grant injunctive and such other
relief as the Court may deem appropriate to halt and redress violations of any
provision of law enforced by the FTC. The Court, in the exercise of its
equitable jurisdiction, may award ancillary relief, including rescission or
reformation of contracts, restitution, the refund of monies paid, and the
disgorgement of ill-gotten monies, to prevent and remedy any violation of any
provision of law enforced by the FTC. 


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PRAYER FOR
RELIEF 

114. WHEREFORE, Plaintiff, the
Federal Trade Commission, pursuant to Section 13(b) of the FTC Act, 15 U.S.C. § 53(b), Section 6(b) of the
Telemarketing Act, 15 U.S.C. § 6105(b), and
the Court's own equitable powers, requests that the Court: 

1. Enter a permanent injunction to prevent future
violations of the FTC Act and the TSR by Defendant; 

2. Award such relief as the Court finds necessary to
redress injury to consumers resulting from Defendant's violations of the FTC Act and the TSR, including, but not
limited to, rescission or reformation of contracts, restitution, the refund of
monies paid, and the disgorgement of ill-gotten monies; and 

3. Award Plaintiff the costs of bringing this action,
as well as such other and additional relief as the Court may determine to be just and proper.


	Dated: January 19, 2017	Respectfully Submitted,
	 
		DAVID C. SHONKA 
		Acting General Counsel
		 	
		/s/ Karen D.
      Dodge	 
		KAREN D. DODGE (IL 6204125)
		JOANNIE T. WEI (IL 6276144)
		ELIZABETH C. SCOTT (IL 6278075)
		Attorneys for Plaintiff
		Federal Trade Commission
		55
      West Monroe Street, Suite 1825
		Chicago, Illinois 60603
		(312) 960-5634 (telephone)
		(312) 960-5600 (facsimile)
		kdodge@ftc.gov (Dodge)
		jwei@ftc.gov (Wei)
		escott@ftc.gov (Scott)



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