>I'm estimating about 30-50% of that is fraudulent.
What are you basing that on?
What are you basing that on?
"For example, a seven-state survey found that approximately 29 percent of Western Union money transfers to Canada in excess of $300 were fraud-induced."[1]
and
"The world’s largest money-transfer company reported a 27 percent drop in fourth-quarter profit, largely due higher costs linked to tightened regulations to prevent money laundering."[2]
Seems like something might be afoot there.
[1]http://www.mtraweb.org/state-attorney-generals-agreement-to-...
[2]http://www.huffingtonpost.com/2014/02/25/western-union-inves...
https://chargedaffairs.org/billion-dollar-industry-nigerian-...
"a follow-up study in 2013 found that the number had jumped to $12.7 billion. This would make the 419 ‘industry’ roughly the same size as the GDP of Botswana."
I believe the vast majority of this is transferred via Western Union.
(And yeah, it's still an estimate, since no-one except WU has any possibility of knowing the truth. Still, 0.1% seems fraud seems like an awefully low estimate, doesn't it?)
You revised it down to 10% now; why? Don't get me wrong, 10 is a great number, much better than 11, but I still don't see any rationale.
To add a perspective: They paid about a penalty for about a 1/1000th of the money they move around. What's your guesstimate for how much of WU money is based on fraudulent transfers?
There are concepts such as "experience", "pattern recognition", extrapolation etc.
That said, I think arguing about how big the fine should be is accepting the faulty premise that a fine is an acceptable penalty. Wire fraud is a felony. I know someone who went to prison for it. The article says "[Western Union] agents were helping scammers avoid detection" and "Fraudsters [...were...] giving Western Union agents a cut in return for processing the payments". They willingly participated in felonies for personal profit. Shouldn't they—and all the supervisors who can be proven to have condoned their actions—be going to prison? Or is this okay just because everyone's doing it and they have a fancy corporation to hide behind?
I would say that's incredibly naive and refer you to this comment: https://news.ycombinator.com/item?id=13465310
> Percent of Americans who have been victims of credit card fraud--10%
0.1% seems very low. I suspect that companies wouldn't even bother with compliance departments if it were actually that low.
Interviews with Ebay execs suggest rates closer to the 3-5% range, and it takes a lot of work to keep it that low.
30% is probably high. But probably not by a huge amount.