FTC says Walmart allowed fraud involving money transfers

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Scammers want payments that are quick, anonymous, and tough to reverse. In other words, scammers are asking for wire transfers. That’s why money transfer businesses like Walmart need to warn people about fraud risks and train employees to spot scams. And that’s why the FTC is suing Walmart in federal court.

The FTC says Walmart has known for many years that scammers use its locations to get money for grandparent, romance, and other scams, but it didn’t properly warn people or train its employees to prevent fraud. According to the FTC, many Walmart locations didn’t display or give people information about potential fraud, which could have stopped them from sending money to a scammer. The company didn’t consistently post warning signs, put out fraud awareness brochures, or use the required money transfer “send” forms with front-page fraud warnings.

For years, according to the FTC, Walmart even looked the other way when scammers picked up money at stores. The FTC says that a single Walmart employee could process hundreds of thousands of dollars of customer financial transactions a day. But for many years, the company didn’t confirm that employees who handle money transfers had the correct — or current — training before they started processing transactions. Walmart employees processed tens of millions of dollars in fraud-related wire transfers annually for many years, according to the FTC.

That’s why the FTC is asking the court to order Walmart to return money to people who were scammed, pay civil penalties, and stop violating the Telemarketing Sales Rule and FTC Act.

To protect against wire transfer fraud

• Never wire money to anyone who claims to be a from a government agency like the IRS, SSA, or Customs and Border Patrol.
• Don’t wire money to a stranger or someone you haven’t met in person, no matter what reason they give.
• Never wire money to someone who tries to sell you something over the phone. It’s illegal for a telemarketer to ask you to pay with a wire transfer.

If a scammer asked you to wire money, tell the FTC at ReportFraud.ftc.gov.

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