A narrowly divided Federal Trade Commission (“FTC”) has filed a misguided lawsuit against Walmart regarding money transfer services that the Company offers to consumers. Here’s what you need to know about the lawsuit:

Since Walmart began offering our customers flat, low fee money transfer services at our stores, the company has saved consumers—particularly the unbanked and underbanked— an estimated $6 billion in fees by bringing important competition to the money transfer industry.

Walmart has a robust anti-fraud program to help stop third-party criminals who try to use money transfer services to commit fraud, and only a miniscule number of transactions are even alleged to be fraudulent. In fact, Walmart has stopped hundreds of thousands of suspicious transactions totaling hundreds of millions of dollars.

Despite Walmart’s anti-fraud programs, the FTC is trying to blame the Company for actions by third parties, including fraud the FTC has already acknowledged was caused by another company—while that company was under federal government oversight through a compliance monitor, and during a period when that company’s own fraud prevention system had failed.

This civil lawsuit is factually misguided and legally flawed. In fact, it was approved by the FTC by the narrowest of margins after Chair Lina Khan refused Walmart the due process of hearing directly from the company, and then the Department of Justice refused to take this case to court.

Despite the fact that the Justice Department took a pass on this lawsuit and two of the FTC’s own Commissioners voted against it, the FTC has unfortunately chosen to pursue a misguided lawsuit that distorts existing law by attempting to hold Walmart strictly liable for the wrongdoing of third-party criminals, despite all our efforts to stop fraudsters.

Walmart will defend against this lawsuit aggressively.

Pro-consumer competition in the money transfer industry is too important to be threatened by the unfortunate decisions of a few Commissioners of the FTC, and Walmart remains focused on fighting fraud and delivering low prices to our customers.

Keep reading to learn more about how Walmart has disrupted the money transfer market to help consumers, how Walmart fights fraud , and the problems with the FTC’s lawsuit .

Walmart is dedicated to serving our customers by providing everyday low prices to help people live better. We are proud to offer customers convenient and budget-friendly one-stop shopping and services that are accessible to all. As part of delivering on that mission, Walmart offers a number of financial services in-store, including money orders, bill payment, check cashing, gift cards, branded credit cards, and money transfers—the financial service product that is the subject of the FTC’s lawsuit.

Money transfers are just one component of our overall business. They provide an important service to millions of customers who are often excluded from traditional financial services, and rely on Walmart to send or receive money from family and friends.

Walmart serves as an “agent” of other companies that actually transmit the money from one location to the other. Walmart first began offering money transfers as a MoneyGram agent in 2005, and later became an agent for Western Union.

Over time, Walmart saw an opportunity to lower prices for our customers by introducing a white label money transfer service. In 2014, Walmart partnered as an agent for Ria to launch Walmart2Walmart, a new low-cost money transfer service built around transparent, everyday low prices.

This new service gave consumers another choice to send or receive cash in a market that had been dominated for years by MoneyGram and Western Union. As explained in the Wall Street Journal , by offering money transfer fees “as much as 87% below the competition,” Walmart’s innovative and disruptive entry into the money transfer business has been especially beneficial to “financially vulnerable” unbanked and underbanked consumers who often lack access to traditional financial services.

In addition to saving our own customers an estimated $2.4 billion in fees since launching Walmart2Walmart, our entry into the market caused MoneyGram and Western Union to cut their prices, saving consumers an estimated additional $4 billion in fees.

While saving consumers billions by shaking up the money transfer market, Walmart has also worked hard to keep those same consumers safe by helping stop third-party criminals from using money transfers to scam customers. And Walmart’s efforts are working. Walmart has stopped hundreds of thousands of suspicious transactions totaling hundreds of millions of dollars. Our efforts have been incredibly effective, resulting in fewer than 2 out of every 10,000 money transfers at Walmart being reported as possibly fraudulent in 2021. Below are some notable steps that Walmart takes to ensure that customers can feel confident using our financial services products.

Walmart routinely works with law enforcement and government agencies to stop fraud and other crime. The Company has made significant contributions to enforcement efforts, and has been recognized by various regulators and law enforcement agencies.

For example, after detecting a fraud trend in Colorado, Walmart started an investigation and worked with law enforcement to apprehend a fraudster who scammed victims across several states. DOJ ultimately charged the fraudster with defrauding victims out of more than $3 million through a property rental scam .

More recently, CNBC reported that technology developed by Walmart helped the Company identify and freeze millions of dollars in suspected gift card fraud, and Walmart turned those funds over to law enforcement—keeping them out of the hands of fraudsters and helping the government support fraud victims.

Walmart also works with corporate and non-profit partners to help prevent financial services fraud. For example:

Walmart provides warnings and customer-facing resources to help our customers recognize frauds and scams before they fall victim. These resources are available in Walmart Money Centers and online.

Walmart associates are part of a large team dedicated to preventing fraud. Before Walmart associates can process money transfers, they must complete computer-based anti-fraud training. Each year they go through additional computer-based training on Walmart’s financial services compliance procedures and how to apply those procedures to identify, prevent, and report fraud and other suspicious activity. Walmart has developed our own register “lock-out” function so that associates who are not current on required training cannot process money transfers.

Through Walmart’s anti-fraud training, associates who process financial services transactions are trained to recognize red flags suggesting potential fraud, such as customers who are on the telephone with someone instructing them to send money, customers who are concerned about an emergency situation, or customers who have not met the sender or receiver of a money transfer. Walmart also trains associates to ask customers questions, such as how they know the receiver and why they are sending money. And associates are trained not to process the transaction if they suspect fraud.

Associates are also prompted to ask specifically whether customers are conducting a money transfer based on outreach from a telemarketer. If the customer says that he or she is sending money to pay for a telemarketing purchase, Walmart’s point of contact services system (“POCS”) terminates the transaction.

In addition to annual computer-based training, Walmart takes other steps to educate associates about fraud, including:

Within our Financial Services Compliance team, Walmart has a Consumer Fraud Team dedicated to anti-fraud measures including, but not limited to, the following:

Walmart uses fraud controls along with other aspects of our comprehensive program to prevent fraud. Two primary controls are Walmart’s proprietary Store Referrals (STaR), real-time interdiction tool, and customer blocking.

The FTC’s complaint distorts the facts and the law to try and hold Walmart responsible for a miniscule amount of reported fraud, even though we had an extensive program to try to stop such fraud, and continuously improve our anti-fraud efforts to this day. While the FTC faults Walmart for not stopping every reportedly fraud-induced transfer, the fact is that Walmart has worked hard to stop fraud and our associates have stopped hundreds of millions of dollars in suspicious transactions. Below are just some of the problems with the FTC’s lawsuit:

One major flaw with the FTC’s lawsuit is that it tries to shift blame to Walmart for reported fraud the FTC itself has already said was caused by a money transfer principal—and that happened while that company was under a federal government compliance monitor. Specifically:

Another big problem with the FTC’s lawsuit is that it wrongly claims that Walmart did not train associates to deny payouts to suspected fraudsters.

Not only is the FTC’s complaint untethered to the facts, but it is also based on a flawed and novel legal theory that the FTC is pursuing after a landmark Supreme Court case said the FTC had been ignoring the law for decades.

Walmart is going to keep doing what we have been doing—working to provide customers with important financial services at low, transparent prices. We are going to continue working hard to prevent third-party criminals from using money transfers to defraud consumers. And we are going to defend ourselves vigorously against this lawsuit.

The FTC’s decision to pursue Walmart raises serious questions, including about the government’s own conduct. Among other things, we want to know how MoneyGram’s colossal interdiction system failure could have happened—for 18 months—while MoneyGram was supposed to be under government supervision. We want to know when and how the government found out about this failure, and what if anything the government did to warn customers and MoneyGram agents like Walmart about this failure. We have already started asking those questions through a FOIA request we filed weeks ago.

In the meantime, we will keep focusing our attention where it belongs—on improving the lives of our customers.