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MoneyGram faces lawsuit for failing to provide details on its partnership with Ripple

Remittance company MoneyGram is facing a class action lawsuit alleging that the company made false statements and did not offer details to its users about its association with Ripple Labs, which involved the XRP token.

The Pomerantz law firm announced today in a statement that it has gone to the District Court of California in the United States, to file a class action lawsuit against the firm MoneyGram International, Inc. and some of its

In the document, attorney Robert S. Willoughby notes that acts on behalf of the individuals and entities that purchased MoneyGram securities between June 17, 2019 and February 22, 2021. The legal recourse requests that the company cover the damages caused by the violation of the laws on the issuance and sale of securities.

The lawsuit alleges that MoneyGram misled those who bought shares or acquired securities of the company, about its association with Ripp le, as well as the legal status of the XRP token. It adds that the remittance company did not disclose that it was using the XRP token as part of its association with Ripple Labs, Inc, or that it was considered a security and “therefore, illegal before the United States Securities and Exchange Commission (SEC). ”

The lawyers point out that if the SEC enforces the securities laws against Ripple, MoneyGram would lose“ the lucrative flow of market development fees ”, something that would affect the financial results of the company and the investors who acquired its shares.

In the last week, MoneyGram shares have fallen more than 6%. Source: yahoo.com

More accusations for MoneyGram

The Pomerantz law firm is not the only one acting in defense of investors, as another similar lawsuit was filed this week by the firm Legal Rosen on behalf of those who acquired MoneyGram securities. In it, it is also alleged that the company behaved fraudulently to introduce the XRP token in its transactions in alliance with Ripple.

About these lawsuits, there has been no official pronouncement by MoneyGram, or its directors. In February, the company announced that it had stopped operating on the Ripple Labs platform due to the SEC’s lawsuit, as CriptoNoticias reported. This same week, Ripple announced that both companies had made the decision to end the partnership they had been holding since 2019.

In August of last year this media also reported that the SEC had published a report disclosing that MoneyGram had received commissions of $ 15.1 million in XRP for providing liquidity to the Ripple Labs cross-border network. To do this, it used the platform On-Demand Liquidity ( ODL) to process payments in near real time between multiple countries.

However, in December, following the SEC’s lawsuit against Ripple, MoneyGram said that it did not rely on the ODL platform for the transfer of consumer funds.

«MoneyGram does not use the ODL or RippleNet platform for direct transfers of consumer funds, digital or otherwise. In addition, MoneyGram is not part of the SEC action ”, as it pointed out at the time.

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Sandra Loyd
Sandra Loyd
Sandra is the Reporter working for World Weekly News. She loves to learn about the latest news from all around the world and share it with our readers.

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