Western Union to pay $184M fine for past AML violations

WASHINGTON, D.C.—The Financial Crimes Enforcement Network, or FinCEN, has assessed a $184 million civil money penalty against Western Union Financial Services, Inc.

Western Union consented to FinCEN’s determination that prior to 2012, it willfully violated the Bank Secrecy Act’s anti-money laundering requirements by failing to implement and maintain an effective, risk-based AML program and by failing to file timely suspicious activity reports. FinCEN’s penalty is in conjunction with actions by the U.S. Department of Justice and the U.S. Federal Trade Commission.

“This consent agreement with Western Union reflects that company’s recognition of past shortcomings and the damage that can be done when there is a failure of a culture of compliance,” said FinCEN acting director Jamal El-Hindi. “Money transmitters, large and small, play a critical role in the movement of legitimate funds around that world, and they also are of vital assistance to FinCEN and law enforcement in thwarting illicit activity. As such, it is imperative that they maintain appropriate safeguards to keep illicit actors from abusing their products, and take to heart that not all business is good business.”

Collectively, Western Union businesses comprise a network of approximately 500,000 agent locations in 200 countries and territories worldwide.

U.S. AML rules require Western Union, as a money services business, to have an effective AML program in place to prevent the company from being used to facilitate money laundering and the financing of terrorism. As part of their AML program, Western Union needed to take reasonable steps to guard against the flow of illicit funds, including through its relationships with foreign agents and outlets. WUFSI violated this requirement by failing to conduct adequate due diligence (such as background checks and on-site reviews) on a number of its new agents and failing to conduct enhanced due diligence on certain Latin America-based agent locations.

Pursuant to the terms of the settlement agreement, FinCEN will deem its penalty fully satisfied by WUFSI’s payment to the DOJ pursuant to the forfeiture order of $586 million for the victims of fraud. WUFSI has also agreed to a number of remedial undertakings including increased scrutiny and periodic reporting regarding agent SAR reporting and disclosure of corrective actions taken against agents. FinCEN recognizes and extends its thanks to the many state partners for their contributions to our investigation and to the Department of Justice and the Federal Trade Commission for their partnership with FinCEN in coordinating this matter.