MoneyGram Fraud

UPDATED: Sep 30, 2022

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MoneyGram Fraud

We offer MoneyGram services at our convenience store. A fraudster called our employee and conned them into transferring over $10,500 to some random people. We did sign a contract with MoneyGram essentially stating that, “We agree to safeguard and be responsible for all MoneyGram funds lost for any reason, including theft or fraud”. While we do not dispute the above, here are other relevant facts. When we were setting up originally, MoneyGram made us create new access codes for employees to login and process money transactions. We did not give access or access codes to this particular employee to login and perform transactions The fraudster gave the access code to employee to login and process transactions. We later realized that there is a default access code for the computer. MoneyGram neither disabled this code nor inform us. If not for this default code, there is no way these fraudulent transactions could have taken place. Is there anyway we can fight MoneyGram in taking up the responsibility or do we just take it up on us and pay all of the money to MoneyGram?

Asked on April 18, 2017 under Business Law, Arkansas


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 5 years ago | Contributor

No, if you agreed, as you write, to be responsible for all funds lost including due to fraud or theft, from your location, you contractually obligated yourself to compensate Moneygram for this money--you agreed to pay them under circumstances like this, and can be held to that agreement. However, since your employee was seemingly negligent or careless, you could sue him to recover from him any amounts that you have to pay out due to his unreasonable carelessness.

IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

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