Thread: Western Union Empire Moves Migrant Cash Home

Western Union Empire Moves Migrant Cash Home
JASON DePARLE

WASHINGTON, Nov. 21 — To glimpse how migration is changing the world, consider Western Union, a fixture of American lore that went bankrupt selling telegrams at the dawn of the Internet age but now earns nearly $1 billion a year helping poor migrants across the globe send money home.

Migration is so central to Western Union that forecasts of border movements drive the company’s stock. Its researchers outpace the Census Bureau in tracking migrant locations. Long synonymous with Morse code, the company now advertises in Tagalog and Twi and runs promotions for holidays as obscure as Phagwa and Fiji Day. Its executives hail migrants as “heroesâ€

NEW YORK Many of the customers at Armajeet Singh’s market in Queens are immigrants from South Asia.

October 09, 2006
Western Union: Hawala for Illegal Alien Paymasters


Today's Wall Street Journal (subscription only) has a very interesting article about something we've been hearing about. Western Union makes millions in the illegal alien trade, and it's not just from aliens wiring money back to relatives back in Mexico. A lot of it is from relatives or employers of illegal aliens here wiring the money to Mexico to the heads of smuggling cartels, once they determine that their smugglee is here.

According to the Wall St. Journal, the brave person doing the crackdown is a State official and predictably, Western Union is upset over this loss of a huge source of its revenue. A few excerpts:

In late September, Arizona General Terry Goddard moved to block electronic payments to traffickers obtaining warrants to seize all Western Union money transfers of at least $500 going to the Mexican state of Sonora, directly south of the Arizona border, and originating in 29 U.S. state--including California, New York, Florida, Illinois and Georgia. . . .

In court filings, Western Union called Arizona's use of the warrants a "threat of incalculable damages." The crackdown is harming innocent people, whose money is being held indefinitely, Western Union says. "May of the people are just frightened," Chief Executive Christina Gold said in an interview. "Some of them don't speak Engllish and are not sure what's going on."

Uh, Christina and Western Union, ya think the fact they don't speak our language is a hint they ain't legal?

The Journal also reports that Western Union clerks were caught taking bribes in exchange for accepting fake IDs from a recipient and

[an Arizona] audit found that in certain outlets more than half of the recipients of money transfers used fake Social Security cards to pick up funds.

So what Does Western Union say? Basically, screw you, America:

Western Union says there isn't much it can do about money tranferred legally over its network but that may be part of an illegal enterprise. "We are not . . . law enforcement agents," Western Union said in a statement.
And Western Union whines Arizona laws restricting money transfers are "exceedingly strict." as they should be.

Western Union moved $42 billion around the globe, last year, and takes a good cut of what it moves. But apparently, that's not enough. Western Union was just spun off from its parent company, and it's desperate to get its share price up. More of what I've been writing about with regard to capitalism without limits. Western Union is bummed out that since the Arizona AG has been enforcing the law, money transfers year-to-date between the U.S. and Mexico grew only 3% compared with a year earlier.

Arizona officials estimate that 95% of illegal aliens crossing the border contract with smuggling cartels in Mexico, charging $1,600 per alien they bring over the border. When their friends or employers wire payment to Mexico, they are released to their custody.

Over a two-month period in early 2005, $28 million was wired from the U.S. to Sonora . . . . The Arizona Attorney General says $19 million--or 67% of the total--was wired to just eight Western Union agents [out of 201 licensed in the area] in five Mexican cities . . .--all "launching pads on or near the Arizona border where groups of immigrants gather to cross illegally.

In the Sonoran city of Altar, a bustling town 50 miles south of Sasabe, a border village that is a popular crossing point, one Western Union customer received $68,000 in 34 payments over a two-month period, or $2,000 every two days. "The apparent brazen activity of pick-up operators in northern Sonora is no doubt due to the complete lack of law-enforcement investigation of wires sent to those locations," states an affidavit sworn by Daniel Kelly, a financial cimres investigator with the Arizona Department of Public Safety.

Spurred by those findings, Mr. Goddard, that state Attorney General, early this year began ordering Western Union to fingerprint recipients, demand multiple forms of identification and take other precautions. Frustrated that transfers to coyotes appeared to be shifting outside Arizona, Mr. Goddard moved to begin seizing transfers from other states in September. Western Union responded by seeking court relief.

"It's gone from 'amicable' and 'in discussions' to bringing this to court," says Mr. Goddard, who adds he still hopes to negotiate a settlement with Western Union.

We hope Western Union doesn't just get to pay a few mill, Wal-Mart style, and get away with it. Arizona allowed Western Union to pay $3 million to end a state probe regarding agents who accepted fake or illegible ID cards.

http://www.debbieschlussel.com/archives ... ion_h.html

Western Union’s increasing business and market share opportunities are correlated to the increasing numbers of its primary consumer—the migrant population. As immigrants move around the globe, seeking better opportunities in wealthier countries, they leave behind family in their country of origin and often need to send money back home. The immigrant population of 190 million, 38 million in the US alone, creates the need for a global remittance program, which can conveniently provide them with a network of outside agents who will distribute their hard-earned money to their families all across the globe. This includes about 12 million immigrants of Hispanic origin who do not have the documentation to open up bank accounts, and are forced to use the services of companies such as Western Union. Western Union is essentially providing services to the unbanked population: about 30% of senders and 80% of receivers. Ninety percent of C2C transactions in 2006 were still traditional walk-in cash-based payments at an agent location.



http://www.wikinvest.com/stock/Western_ ... ompany_(WU)