The Federal Trade Commission (FTC) of the United States has reportedly sued Walmart Inc. insinuating that the company did almost nothing to prevent scammers from using its money transfer services to defraud customers that cost them millions of dollars.

Notably, aside from being a retail chain, Walmart provides some financial services like acting as a broker for money transfer companies like MoneyGram and Western Union Company. The FTC has lodged a case against the retail giant in the Northern District of Illinois which revealed that the fraudulent transfer of money that was handled by the workers at Walmart has cost the consumers nearly tens of millions of dollars.

According to the objection, Walmart was aware that scam artists posing as distraught grandchildren, federal officers, or engaging in other recognized bogus schemes, had used its money transfer services to move funds to numerous fraud chains.

The Commission stated that for years Walmart's strategy was to release payments even when there were doubts about forgery in a transaction, but the retail chain declined to consider other steps to safeguard customers from being swindled.

It proceeded to perform fraud-induced funds transfers at its store locations, financing telemarketing, and other schemes, without implementing processes and regulations that could have efficiently & easily helped identify and help stop these exchanges.

As a result, the FTC has announced that it would ask a court to order Walmart to give back the missing money to customers and compensate by paying the punitive damages.

It is worth noting that Walmart denied all claims and called this court case factually unsubstantiated and legally questionable. It responded by saying that the agency is trying to hold Walmart responsible for deception while it previously accused another company that was directly chaperoned by the federal government for the same.

Interestingly, the decision to file the lawsuit against the retail corporation resulted in a 3-2 vote with objections from two Republicans and was supported by three Democrats.

Source credits:

https://money.usnews.com/investing/news/articles/2022-06-28/u-s-ftc-sues-walmart-for-allegedly-allowing-money-transfer-services-for-fraud