By Andrew R. Johnson
Western Union Co. (WU), the world's largest provider of
money-transfer services, received additional information requests
in the third quarter from state attorneys general over its
consumer-fraud prevention measures, the company said Tuesday in a
regulatory filing.
The requests came in the form of Civil Investigative Demands as
part of a probe into whether the company "took adequate steps to
help prevent consumer fraud from 2010 to 2011," Western Union said,
adding the requests "seek information and documents relating to
consumer fraud complaints that the company has received and the
company's procedures to help identify and prevent fraudulent
transfers."
Western Union operates a remittance network that allows
consumers and businesses to send money domestically and abroad. Its
consumer services are sold through a network of 510,000 agents,
including grocery stores, pharmacies, payday lenders, banks and
other retailers, and cost a fee based on the amount of money
customers are sending and where they are sending money to.
The company previously had disclosed it received similar
requests in the fourth quarter of 2011. The new disclosure was made
in Western Union's 10-Q filing with the Securities and Exchange
Commission.
The company said it couldn't predict the outcome of the
investigation or quantify any potential losses that could result
from potential civil claims tied to the probe.
Western Union's stock dropped 29% last Wednesday, a day after it
reported third-quarter results and announced a major price cut,
citing increased competition.
Western Union's shares closed up 1.6% at $12.41 on Tuesday and
were inactive after hours.
Write to Andrew R. Johnson at andrew.r.johnson@dowjones.com
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