On March 16, 2022, New York State Department of Financial Services (NYS DFS) Superintendent Adrienne Harris announced in a press release that NYS DFS imposed a $8.25 million penalty on MoneyGram. According to NYS DFS, the penalty was imposed for compliance issues. In January 2016, NYS DFS initiated a 17-month long investigation that revealed MoneyGram was involved in a widespread money laundering scheme. According to the press release, over $100,000 in funds were transferred to China over the course of the 17-month long investigation, and thousands were defrauded out of over $100 million.
The investigation revealed MoneyGram failed to properly oversee the activities of their agents. According to the press release, this constitutes a violation of New York law and the Bank Secrecy Act/Anti-Money Laundering (“BSA/AML”). MoneyGram stated that it subsequently terminated its relationship with the agents, and worked to reach a settlement with NYS DFS.
The press release revealed that MoneyGram has agreed to the pay $8.25 million, and entered into a deferred prosecution agreement (DPA) with the Department of Justice (DOJ) for processing transactions for its own agents who were known to be engaged in widespread money laundering. MoneyGram also stated that it has invested $800 million in compliance technology, agent oversight, and training programs, and as of May 2021, has received approval of its new compliance measures.