Securities fraud charges may be leveled at Western Union if an SEC investigation confirms reports that the world’s largest money-transfer company misled potential investors about how much revenue it expected from its digital unit.
“The Securities and Exchange Commission is reviewing the company’s public statements in 2011 and 2012 that it planned to increase revenue at Western Union Digital, including westernunion.com and its mobile money-transfer business, to $500 million by 2015. That revenue was about $200 million in 2013, according to spokesman Dan Diaz. In July, the company pushed out the target to beyond 2015,” reported Bloomberg. “The SEC said in its court filing that it received complaints from former employees about possible misconduct that may have distorted revenue at the digital unit. The ex-employees claimed to have raised their concerns about the accuracy of certain public statements with three company officials, according to the filing.”
The matter has come to light because, according to the Bloomberg report, the agency sent Western Union officials a subpoena in July demanding information about three employees who had been identified by the former employees. “At the time of the court filing, Western Union hadn’t produced any of those documents, the SEC said. The company had previously handed over more than 3,500 documents in response to other SEC subpoenas seeking information about the digital unit and an expansion of European retail locations,” Bloomberg reported.