Western Union to compensate Caribbean & US fraud victims through remission fund

American multinational financial company Western Union will be compensating some 25,000 people in the United States, across the Caribbean, and other locations, who have fallen victim to fraud or lottery scamming.

According to the United States Department of Justice (DOJ), the company has started the distribution of about US$40 million through its Western Union Remission Fund to the fraud victims.

The fund was set up in 2017 when Western Union agreed to forfeit $586 million and entered into agreements with the Justice Department and the Federal Trade Commission. In its agreement with the Justice Department, Western Union admitted that it violated U.S. laws by processing hundreds of thousands of transactions for certain owners, operators, or employees of Western Union agent locations involved in an international consumer fraud scheme.

The DOJ said that these victims stand to recover the full amount of their losses.

The payout is the first distribution in the second phase of the Western Union remission distributions. The DOJ said the first phase of distributions paid more than US$365 million to over 148,000 victims, all of whom received full compensation for their losses.

The Justice Department anticipates authorizing more distributions for victims in the coming months.

Following the announcement on Friday, US Attorney Gerard M. Karam for the Middle District of Pennsylvania said: “Today's distribution of US$39.6 million to thousands of victims to compensate them for their losses demonstrates our commitment to hold all responsible parties accountable and to ensure justice for the victims who were financially harmed. We thank our law enforcement partners who continue to work tirelessly on behalf of the victims.”

Lottery scamming in Jamaica

In recent years, lottery scamming has become one of the leading crimes in Jamaica.

It typically targets individuals, primarily in the United States and Canada, with promises of winning a large sum of money through a lottery or sweepstakes. Victims are often pressured into sending money to the scammers. Every year, victims, usually elderly people, are tricked out of hundreds of millions of dollars.

The issue has affected Western Union operations in Jamaica. In the past, the company has had to temporarily shut down its services at several locations in Montego Bay — which is considered a hotbed for scamming.

Lottery scamming has also caused strained diplomatic relations between Jamaica and countries like the United States and Canada, leading to increased scrutiny of visa applications and travel from Jamaican citizens.