HALISTER1: Western Union Probe May Benefit MoneyGram, Euronet: SunTrust

Western Union Probe May Benefit MoneyGram, Euronet: SunTrust

(Bloomberg) -- DOJ investigation uncovering Western Union’s anti-money laundering failures and wire fraud complicity may be positive for MoneyGram and Euronet, as the probe was “clearly targeted” at WU, SunTrust’s Andrew Jeffrey writes in report.
  • Notes that WU currently dedicates over 20% of employees and ~$200m per year on compliance; DOJ fine “calls into question” efficacy of compliance spend
    • Notes that $586m charge equates to ~$1.20 per share
  • Agreement may lead to “more onerous” regulatory backdrop
  • MGI shares up 2.5%; WU down as much as 6.4%, the most intraday since Aug. 2015
  • NOTE: Nov. 14, Pennsylvania Sues MoneyGram in 24-State Dispute: BNA
  • NOTE: Feb. 23, Western Union Quizzed by EU in Money-Transfer Antitrust Probe
  • NOTE: Feb. 19, Western Union Says U.S. Money Laundering Probe Tied to Gaming
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

Tickers
EEFT US (Euronet Worldwide Inc)
MGI US (MoneyGram International Inc)
WU US (Western Union Co/The)

People
Andrew Jeffrey (SunTrust Robinson Humphrey Inc)

Topics
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