While Big Tech companies receive special treatment, Walmart was fined $10 million to settle Federal Trade Commission (FTC) allegations of failing to prevent wire fraud.
This allowed scammers to exploit its money transfer services for years, costing consumers hundreds of millions of dollars.
The giant store agreed to pay $10 million to settle FTC allegations that it failed to prevent scammers from using its in-store money transfer services.
The government claims these scams stole hundreds of millions of dollars from consumers nationwide between 2013 and 2018.
The settlement, announced by the FTC this week, comes after a year-long investigation that began with a complaint filed in June 2022.
The federal agency accused Walmart of lacking effective anti-fraud policies, failing to train employees properly, and not adequately warning customers about potential fraud risks.
Walmart has criticized the FTC’s case as regulatory overreach.
The company did not admit to any wrongdoing as part of the settlement, suggesting this may be another example of government agencies strong-arming corporations into settlements rather than proving actual misconduct.
The settlement requires the company to implement measures to detect and prevent fraudulent transactions, effectively forcing the company to act as a financial crimes enforcement unit.
This raises questions about whether the government is offloading its law enforcement responsibilities onto private businesses while simultaneously punishing them when criminals exploit their services.
As part of the settlement, Walmart is prohibited from providing money transfer services without implementing effective fraud detection measures.
The retailer is also banned from processing known fraudulent transfers and assisting telemarketers involved in fraud-induced money transfers – responsibilities that traditionally fall to law enforcement agencies.
The FTC approved the final order with a 3-0 vote and filed in the U.S. District Court for the Northern District of Illinois.
The court had previously dismissed telemarketing-related claims in July 2024, and the Seventh Circuit Court of Appeals allowed Walmart to appeal certain district court rulings on core fraud claims in November 2024.
Government agencies continue targeting American businesses with hefty fines and burdensome regulations.
Meanwhile, many hardworking consumers who rely on Walmart’s affordable services wonder who will ultimately bear the cost of these government actions.
As is often the case with regulatory overreach, the financial burden typically falls on everyday Americans through higher prices and reduced services.
