Walmart Sued by FTC for Money Transfers

Bernard Nash
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  • The FTC sued Walmart alleging that the company violated the FTC Act, Telemarketing Act, and Telemarketing Sales Rule (TSR) when it turned a blind eye as fraudsters used the company’s wire transfer services to scam customers out of millions of dollars.
  • According to the complaint, Walmart offers transfer services both in-house and through third-parties such as MoneyGram, Western Union and Ria. The FTC alleges that, from 2013 to 2018, more than $197 million in payments sent or received at a Walmart location were subject to fraud complaints, and more than $1.3 billion in related payments may have also been fraud-induced.
  • The FTC alleges that Walmart was aware that its money transfer services were used to facilitate fraud, but the company failed to take reasonable measures to mitigate the harm to consumers. Specifically, the FTC alleges that Walmart instructed employees to complete payouts for suspicious transfers, failed to have an effective anti-fraud or consumer protection program, allowed cash pickups for large payments, failed to properly train employees, allowed money transfers to be used to pay for telemarketing purposes, and failed to provide required materials to consumers that could have warned them about potential fraud.
  • The complaint seeks a permanent injunction prohibiting Walmart from future violations of the FTC Act, Telemarketing Act, and TSR, monetary civil penalties for all TSR violations, and any other relief the Court deems appropriate for consumer redress,  including reforming contracts, returning property, additional monetary damages, or public notification.
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