Deadline Approaching For Delaware Scam Victims Who Used Western Union To Claim Repayments

Delaware consumers who used Western Union from 2004 to 2017 to send money to scammers and lost their money are reminded they have a month to file a claim to get their money back under a legal settlement.

Under a settlement between Western Union and state attorneys general, including Delaware, anyone who was tricked by scammers into sending money by Western Union between January 1, 2004 and January 19, 2017 can go to www.ftc.gov/WU before February 12, 2018.

Some people who have already reported their losses to Western Union, the Federal Trade Commission, or another government agency will receive a form in the mail from the claims administrator, Gilardi & Co. The form will have a Claim ID and a PIN number to use when filing a claim online via FTC.gov/WU. Gilardi was hired by Justice Department, which is responsible for returning victims’ money as part of its settlement with Western Union.

Filing a claim is free, so consumers should not pay anyone to file a claim on their behalf. No one associated with the claims process will ever call to ask for consumers’ bank account or credit card number. If you lost or did not receive a claim form, there is also a link on www.ftc.gov/WU which will enable you to file.

The attached graphic from the FTC is a simple explanation of the claims process.

The settlement with Western Union came after state and federal consumer protection agencies alleged that fraudsters were able to use Western Union’s money transfer system to get payments from their victims, even though the company was aware of the problem and received hundreds of thousands of complaints about fraud-induced money transfers made for fraudulent lottery and prizes, family emergencies, advance-fee loans, online dating and other scams. The settlement announced in January 2017 required $586 million from Western Union to repay consumers, and required Western Union to develop and put into action a comprehensive anti-fraud program designed to help detect and prevent incidents where consumers wire money to scam artists.

Previous Announcements from the Delaware Department of Justice regarding the settlement and claims process can be found at https://news.delaware.gov/2017/01/31/wu/ and https://news.delaware.gov/2017/11/13/wus/.


Statewide consumer shredding events offered this fall

Free service from Attorney General’s Consumer Protection Unit helps consumers guard against identify theft

Wilmington – Attorney General Beau Biden today announced that his Consumer Protection Unit is hosting three free consumer shredding events this fall to help consumers guard against identity theft. Each event will feature free on-site document shredding and staff will be on-hand to provide information and answer questions about consumer frauds and scams.

“Shredding documents that contain sensitive personal and financial information is one important step consumers can take to help prevent identity theft,” Biden said. “That’s why our Consumer Protection Unit provides free shredding events as a public service. In addition, Delawareans can learn much more about protecting themselves from identity theft by visiting www.attorneygeneral.delaware.gov or by contacting our Consumer Hotline at 1-800-220-5424.”

Each consumer may bring up to three file-sized boxes of documents, which may contain paper file folders, staples, and paperclips. Emptied boxes will be immediately returned to consumers.

Biden noted that identity theft remains one of the nation’s fastest-growing crimes and reminded Delawareans to help prevent becoming a victim by regularly monitoring their financial accounts for unauthorized activity and limiting information they post about themselves online, in addition to securely destroying unneeded financial documents.

A study by a national financial services research firm found earlier this year that the number of Americans who reported being the victim of identify fraud increased to 13.1 million in 2013 – representing one victim every two seconds. In addition, the Federal Trade Commission reports that identify theft remained the top consumer complaint last year.

The fall consumer shredding events will take place as follows:

Saturday, September 27
9 am to 1 pm
Lowe’s/BJ’s parking lot
Peninsula Crossing Shopping Center, Route 113, Millsboro

Saturday, October 4
9 am to 1 pm
DelDOT Administration Building parking lot
800 Bay Road, just south of the Route 13-113 split, Dover

Saturday, October 11
9 am to 1 pm
Delaware Tech Stanton Campus (lower level parking lot)
400 Stanton-Christiana Road, Newark

# # #


J.P. Morgan Securities to pay $51,400 to Biden’s Investor Protection Unit

Wilmington – Attorney General Beau Biden announced Thursday that J.P. Morgan Securities has paid the Delaware Department of Justice $51,400 as a result of a settlement with the Attorney General’s Investor Protection Unit. The settlement resolves a multi-state investigation which found that J.P. Morgan Securities failed to ensure that its agents were properly registered in Delaware and other states, and failed to properly record data on trades executed in Delaware and other states.

“Our financial system only works when everyone plays by the rules, and there must be accountability when the rules are broken,” Biden said. “State law requires those who sell stocks and securities to Delaware investors to be registered with our Investor Protection Unit, and to record their trades properly. Ensuring that J.P. Morgan Securities follows the law and its agents register with us gives my office the ability to protect the investments, pensions, and retirement funds of Delawareans.”

J.P. Morgan Securities functions as a broker-dealer in Delaware. The states’ investigation found that a flaw in J.P. Morgan Securities’ order entry system allowed agents not registered in Delaware to accept orders from investors in Delaware. J.P. Morgan Securities settled the multi-state investigation, coordinated by the North American Securities Administrators Association and led by the New Hampshire Board of Securities Regulation, by agreeing to pay up to a total of $2,790,625 in civil penalties among the 50 states, District of Columbia, Puerto Rico and the U.S. Virgin Islands. In addition to its payments to the states, J.P. Morgan Securities revised its client transaction processes and supervisory procedures to address the violations. Delaware’s payment was made to the Attorney General’s Investor Protection Fund which supports securities fraud investigations and investor education initiatives.

The Attorney General’s Investor Protection Unit enforces the Delaware Securities Act. Ensuring proper registration of investment professionals is an important part of the Unit’s mission to ensure that Delawareans are not victimized by fraudulent, unscrupulous or overreaching practices by those offering investments and investment services within the state. Biden urged investors who believe they have been the victims of such practices to immediately contact the Investor Protection Unit Hotline at 302-577-8424.

Delaware’s participation in the multistate investigation that led to the settlement was handled for Delaware by Investor Protection Director Owen Lefkon and Assistant Attorney General David Casler.

# # #


Biden’s Investor Protection Unit Gauging Vulnerability to Cybersecurity Threats

Wilmington – Delaware’s Investor Protection Unit is participating in a nationwide project to gauge the strength of Delaware investment advisers’ cybersecurity systems, Delaware Attorney General Beau Biden announced today.

Delaware law requires investment firms to register with the state’s Investor Protection Unit, which is in the Fraud Division of Biden’s Department of Justice. Recently, Investor Protection Unit Director Owen Lefkon sent surveys to 44 investment companies. The surveys, which are due to be returned by October 31, cover areas such as whether the investment adviser has experienced a cybersecurity event in the past year, experienced loss or theft because of a cybersecurity breach and when the adviser last underwent a cybersecurity threat assessment.

“Financial information is some of our most-sensitive private, personal data,” Biden said. “Financial services firms have a responsibility to protect personal data, and the results of these surveys will help our Investor Protect Unit ensure the data is protected as strongly as possible.”

The survey was developed by the North American Securities Administrators Association (NASAA), of which the Delaware Investor Protection Unit is a member. The survey project is designed to help regulators better understand the technology and data practices of state-registered investment advisers; how these advisers communicate with clients; and what types of policies and procedures these advisers currently maintain. The pilot project also focused on specific uses of technology and Web sites, with a goal of understanding the safeguards used by state-registered investment advisers to protect client information; to inform state examination programs; and to identify national cybersecurity trends relevant to state-registered investment advisers.

“As the investment business is increasingly conducted over the Internet, the potential for identity theft and other security breaches has risen as well.” IPU Director Lefkon wrote in the letter to investment firms. “It is thus ever more important to ensure that registered firms and individuals take reasonable and adequate precautions to protect the security of information stored in computers and communicated over the Internet.”

# # #


Biden’s insistence on accountability for mortgage crisis leads to $45 million for Delaware, millions more in financial benefits for Delawareans from Bank of America

Biden has now secured at least $180 million from banks for conduct that caused mortgage crisis; Delaware is one of four states to participate directly in past three major settlements

Wilmington – Bank of America has agreed to pay $45 million to Delaware and provide significant financial benefits to Delaware homeowners to settle allegations that it misled investors about the riskiness of mortgage-backed securities, Attorney General Beau Biden announced today.

The settlement is the latest development in Biden’s wide-ranging effort to ensure accountability by financial institutions responsible for the mortgage crisis. Including the $45 million that Bank of America will pay, Biden has secured at least $180 million in mortgage-related settlements.

Delaware’s settlement with Bank of America is part of a $16.7 billion settlement announced Thursday between the bank, the United States Department of Justice, Delaware and five other states – California, Illinois, Kentucky, Maryland, and New York.

“Our financial system only works when everyone plays by the rules, and there must be accountability when those rules are broken,” said Biden, who secured nearly $20 million in a settlement with JPMorgan Chase in November and $17 million from Citigroup in a settlement last month.

“The mortgage crisis wrecked our economy and devastated families and neighborhoods throughout Delaware and the nation,” Biden said. “We cannot allow the mortgage crisis to be a man-made disaster for which there is no accountability. The funds we have secured in these settlements are being put to work helping thousands of Delaware families avoid foreclosure, strengthening communities hit hard by the fallout from the housing crisis, holding banks accountable and reimbursing government losses. Our work is not done.”

Delaware’s settlement comes in three parts:

  • Bank of America will pay $31.6 million to the State. As with previous settlements, the funds must be used to remediate the harm Delaware’s communities suffered as a result of the housing crisis;
  • Bank of America will pay $13.4 million to reimburse government entities for losses suffered on Bank of America, Merrill Lynch and Countrywide investments that were wrongly marketed as being low-risk; and
  • Bank of America will make direct financial benefits, such as mortgage modifications and forgiveness of second mortgages, available to homeowners. Under the terms of the settlement, Bank of America must provide at least $150 million in benefits to consumers in Delaware, Maryland and Kentucky (the three smallest states participating in the settlement). Homeowners with mortgages serviced by Bank of America may be eligible for these benefits. To determine eligibility, homeowners should contact Bank of America at 877-488-7814 or Biden’s Office of Foreclosure Prevention at 1-800-220-5424.

This settlement with Bank of America, along with the two recent settlements with JPMorgan Chase and Citigroup, resolves allegation centering on the bank’s bundling and sale of mortgages to investors. These investments – bought by pension funds, mutual funds and other investors – were represented as low risk but were in fact much riskier than advertised. The resulting losses were disastrous for the economy.

Delaware has become a national leader among states in pursuing accountability for actions that contributed to the housing crisis during Biden’s tenure. Biden is a member of the U.S. Department of Justice’s Residential Mortgage-Backed Securities Working Group, and Delaware is one of just four states (along with California, New York and Illinois) to be part of that group’s past three major mortgage-crisis settlements with some of the nation’s largest banks.

Delaware’s success in holding banks accountable has been possible due to Biden opening investigations into the conduct of financial institutions, the state’s strong enforcement laws, such as the Delaware False Claims and Reporting Act and the Delaware Securities Act, and Biden’s decision to direct a portion of prior settlement funds to pursue future enforcement initiatives.

Biden also played an important role in the February 2012 National Mortgage Settlement that as meant more than $75 million in financial benefits for Delaware homeowners, $11.7 million for the State and important new protections for military personnel and their families that Biden championed in negotiations with the nation’s five largest mortgage-servicing banks.

The Bank of America matter was handled for Delaware by Investor Protection Director Owen Lefkon, Deputy Attorney General Timothy Worthington and Fraud Division Director Matthew Lintner.