SUPERINTENDENT ADRIENNE A. HARRIS ANNOUNCES THAT DFS HAS IMPOSED A PENALTY OF $8.25 MILLION ON MONEYGRAM FOR COMPLIANCE FAILURES Moneygram Failed to Properly Supervise Agents Engaging in Suspicious Transactions to China

[Gunnar Larson]

*Great news out of the great state of New
York: https://www.dfs.ny.gov/reports_and_publications/press_releases/pr202203161
<https://www.dfs.ny.gov/reports_and_publications/press_releases/pr202203161>*


*I am very proud of our Superintendent today. The other news of the day was
not coordinated with this. Obviously, no collusion on soon to be
bankrupt MoneyGram ...: *

Superintendent of Financial Services Adrienne A. Harris announced today
that MoneyGram International Inc. (“MoneyGram”) has agreed to pay $8.25
million in penalties pursuant to a Consent Order entered into with the New
York State Department of Financial Services (“DFS” or the “Department”).
The Consent Order resolves the Department’s investigation into MoneyGram’s
failure to adequately supervise local agents in New York City, including
the Flushing neighborhood of Queens, that processed a substantial volume of
suspicious transactions to China, in violation of Bank Secrecy
Act/Anti-Money Laundering (“BSA/AML”) requirements and New York law.

“Many New Yorkers depend on money transmitters to send money to their
families, pay bills, and conduct other financial transactions,” said
Superintendent Harris. “To maintain the integrity of that system for
law-abiding New Yorkers, it is crucial money transmitters like MoneyGram
diligently monitor all activity on its platform to prevent bad actors from
abusing the system for illegal means.”

An examination and subsequent enforcement investigation conducted by the
Department found that MoneyGram did not adequately oversee the activity of
six agents that saw a large spike in transaction volume of business with
China from locations throughout New York City, including in Flushing,
Queens.

 In 2014, the year preceding the spike in transaction volume, for example,
there were approximately 7,500 transactions between New York and China
aggregating approximately $30,000,000; during the 17-month period from
January 2016 through May 2017, however, there were more than 25,000
transactions to China aggregating more than $100,000,000. The dramatic
change in the number and size of the transactions processed by New York
agents — most of which were small, store-front independent agents — was a
clear indicator of increased money laundering risk, particularly given that
the destination was known to carry a high AML risk. Moreover, other aspects
of the increased transactions, including a suspicious pattern that many
different senders transmitted money to the same recipient, were problematic
and should have put MoneyGram on clear notice to address these risks.

After being made aware of the suspicious spike in activity, MoneyGram
terminated its relationship with the problematic agents and began
instituting remedial measures designed to ensure better supervision of its
agents across its network, among other measures. Under the settlement
reached today, in addition to payment of a $8.25 million penalty, MoneyGram
will be required to report to the Department on the enhancements to the
policies and procedures of its BSA/AML compliance program, its Suspicious
Activity Monitoring and Reporting program, and customer due diligence
requirements. MoneyGram will also furnish data to the Department for
ongoing monitoring purposes.

DFS acknowledges MoneyGram’s cooperation with the investigation and its
ongoing remedial efforts.

Read a copy of the consent order on the DFS website.
<https://www.dfs.ny.gov/industry_guidance/enforcement_discipline/ea20220315_moneygram>

<https://www.dfs.ny.gov/industry_guidance/enforcement_discipline/ea20220315_moneygram>
-- 
*Gunnar Larson - xNY.io <http://www.xNY.io> | Bank.org <http://Bank.org>*
MSc
<https://www.unic.ac.cy/blockchain/msc-digital-currency/?utm_source=Google&utm_medium=Search&utm_campaign=MSc-Digital-Currency-North-America&utm_term=blockchain%20unic&gclid=Cj0KCQiAyJOBBhDCARIsAJG2h5ctwwMz0MRbVSk-LaYD-GMU5UgDSw7ynxbGr_a7SkaFAZzJc1-pzxEaAi4NEALw_wcB>
- Digital Currency
MBA
<https://www.unic.ac.cy/business-administration-entrepreneurship-and-innovation-mba-1-5-years-or-3-semesters/>
- Entrepreneurship and Innovation (ip)

G at xNY.io
+1-646-454-9107
New York, New York 10001
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