Thread: OAKLAND CA: Money wiring firm faces boycott

Money wiring firm faces boycott

An immigrant-advocacy group says Western Union is gouging people who use the service to send money back home.

By Karen Rouse
Denver Post Staff Writer
Article Launched: 09/13/2007 01:00:00 AM MDT


(AP / Dan Loh)
An Oakland, Calif., group that advocates for immigrants plans a national boycott of Greenwood Village-based Western Union, saying the money- wiring service is gouging immigrants through "exorbitant fees" and unfair exchange rates.

The Transnational Institute for Grassroots Research and Action also alleges that Western Union, the largest transmitter of money worldwide, has failed to reinvest in the immigrant communities that have contributed to its becoming a $4.5 billion business.

"There are families here as well as families we've left behind" that use Western Union to wire money home for food, medical care and education, said Francis Calpotura, TIGRA director.

The group said the boycott will be kick off in immigrant communities nationwide Monday.
Western Union spokesman Daniel Diaz declined to specifically address TIGRA's allegations that it overcharges customers, saying only that "our prices are similar to others in the industry."

Diaz declined to say whether the boycott would have an impact on the company.

"We will continue to remain focus(ed) on our business," he said.

He said the company charges $9.99 to send $1,000 the next day to Mexico and $14.99 to get the money within minutes.

Padres Unidos, a Denver organization that advocates for immigrants and students, has thrown its support behind the boycott, organizer Julie Gonzales said.

A recent report by Boston-based financial-research firm Aite Group found that the global money-transfer industry, including bank wires, generated $14.4 billion in revenues last year.

The top five U.S.-based global money transmitters are Western Union, MoneyGram, Sigue, Euronet/Ria and Nexxar, according to the report. Between 2001 and 2006, the five companies grew their combined market share of workers' remittances from 13 percent to nearly 21 percent, the report found.

David Landsman, executive director of the National Money Transmitters Association in New York, said industry growth slowed last year as a result of undocumented immigrants' fears about using the services, but the trend is now "robust and continuing to grow."

Landsman said there are 750 state-licensed money transmitters operating in the United States, with at least $60 billion a year being sent to other countries through wire transfers.

TIGRA officials said the boycott is the result of Western Union's not responding to its demands over the last five months for lower fees, "fairer exchange rates" and "community reinvestment."

TIGRA is demanding that Western Union agree to a "Transnational Community Benefits Agreement" that would reinvest in immigrant communities it serves.

The organization alleges that Western Union reinvests 41 cents for every $100 of profit, compared with $2.30 reinvested by Wal-Mart. TIGRA asks that the company raise that figure to $1 per transaction.

Western Union, however, said it regularly supports causes around the world through its Western Union Foundation.

Since 2001, the foundation has granted nearly $40 million to nonprofit organizations worldwide in more than 70 countries and territories to support humanitarian projects, provide disaster relief and fund education, health and human-services programs.

Recent projects include a $500,000 donation to provide cochlear implants for 38 deaf children in Mexico and $100,000 for fishing boats for fishermen in Thailand hurt by a tsunami.

This week, it announced it is starting a $50 million, five- year program designed to create educational and economic opportunities for migrant workers around the world.

Juan Evangelista, a youth organizer with Padres Unidos, said his parents use Western Union weekly because it is convenient and has a wide number of locations but that they feel they are overcharged.

"For almost every $100 (his father) sends, he gets charged $10," Evangelista said. "Immigrant families send money so they can buy food or send money for medical reasons. These are poor local folks."

Landsman said he believes it is unreasonable for the group to ask Western Union to alter its fees.

"Money-transfer organizations are not charitable organizations," he said.

While TIGRA is targeting Western Union, Calpotura said it is an industrywide campaign.

"We wanted to focus on them because they are the undisputed leader," he said.

The boycott also targets Western Union subsidiaries Vigo and Orlandi Valuta.

TIGRA is a national network of 158 immigrant organizations that promotes community reinvestment. It was started in 2004 by Calpotura.

Staff writer Karen Rouse can be reached at 303-954-1684 or krouse@denverpost.com.


What it costs
$300 transfer to Mexico:

Western Union: $15

Moneygram: $14.50 Xoom.com: $11.99

Bank of America: $0

Exchange rate to Mexico

Western Union: 2.55 percent of total amount

Moneygram: 2.09 percent Xoom.com: 2.37 percent

Bank of America: 1.17 percent

http://www.denverpost.com/weekendflyaways/ci_6876374

I sure now they want to wire money at no cost at all......Heck they get everything else free!

How does this gouge them? I think it's very reasonable...I just wired some money to Atlanta and it cost me $20...I paid and didn't complain, that's what it costs.

Actually, instead of boycotting, they can just carry their money to mexico and stay there

Originally Posted by GoDawgs

How does this gouge them? I think it's very reasonable...I just wired some money to Atlanta and it cost me $20...I paid and didn't complain, that's what it costs.

Actually, instead of boycotting, they can just carry their money to mexico and stay there

Oh My God, I laughed so hard at your last comment!! That is classic stuff! I will tell you what, I will load them and their money up in my truck and drive them to the border!