The latest disbursement of $40 million from Western Union to compensate fraud victims conducted through its payment system is now underway. This comes on the heels of a previous compensation of $365 million.

Western Union, headquartered in Colorado, surrendered the recent sum of $40 million to the Department of Justice (DoJ) to offset the losses of 25,000 victims both within the United States and internationally.

The current distribution signals the onset of the second phase of the Western Union Remission. Initiated in March 2022, this phase was designed to offer restitution to victims who hadn’t previously filed petitions to reclaim their losses. During the inaugural phase, a substantial $365 million was allocated to 148,000 victims.

The backdrop of this compensation program traces back to a 2017 deferred prosecution agreement. In this arrangement, Western Union admitted to various illicit activities, including contraventions of the Bank Secrecy Act and playing a role in wire fraud schemes.

As part of the agreement, Western Union committed to surrendering a total of $586 million to adequately compensate victims of multiple deceitful tactics. Notably, these scams involved fraudsters manipulating individuals to transfer money via Western Union’s system. Some scams, termed “sweepstake scams”, duped victims into believing they had won a significant monetary prize but were required to cover a fee or tax to claim their winnings. Another tactic, known as “grandparent scams”, saw con artists masquerading as family members in dire need of urgent funds. Additionally, romance scams emerged as a prevalent method where Western Union’s platform became the preferred medium for fraudulent transactions.

The DoJ raised allegations suggesting that certain associates or employees within Western Union were actively involved or, at the very least, complicit in facilitating these scams. There were claims that Western Union indirectly supported these scams by not taking decisive action against the implicated agents.

The recent release of $39.6 million is testament to the sustained effort to ensure victims receive due compensation. The US attorney for the Middle District of Pennsylvania, Gerard Karam, emphasized the dedication to ensuring justice for the financially affected victims and lauded the consistent efforts of law enforcement agencies.

Furthermore, the DoJ remains open to receiving petitions for compensation from victims, hinting at potential future compensations in the subsequent months.