December 28, 2007

Western Union: Stealing So Much More Than Money

By Francis Calpotura
New America Media

On International Migrants Day it is important to reflect on the contribution of migrants to their home economies. This year, remittances sent home by migrants reached $300 billion worldwide. That’s $300 billion towards food, medicine, and the support of local development efforts. But business and government are plotting to rob immigrants of our hard-earned money. This is why immigrants have set their sights on Western Union.

The remittance industry, along with national governments, take advantage of migrants’ forced displacement to profit off their separation from family. Money transfer companies recognize that immigrants have few options when sending money – vulnerable low-income immigrant communities must rely on predatory financial institutions to send money home. Such companies, unlike banks, remain unregulated by the Community Reinvestment Act, and so are not mandated to give anything back to the communities they serve.

National governments see remittances as a new financial flow that they need to keep flowing; remittances to impoverished countries now account for three times the amount of overseas development assistance from rich countries. Governments have set up programs not only to encourage workers to seek employment abroad, but are providing matching funds when those same workers send money home.

In Mexico, the government has set up a “Tres por Uno” program that contributes three times as much money as remitters send back. The resultant fund pays for basic infrastructure such as roads and irrigation ditches that are really the responsibility of the state, not emigrants. These same emigrants have little say over how the “Tres por Uno” money is ultimately spent, with the state government administering the program. This program has recently come to be supported by Western Union, which dubs its contribution “Cuatro por Uno,” or four-for-one.

What is problematic about this set of economic policies aimed at profiting from migrant labor is that the migrants themselves have little say in the matter. Harmful economic policies under corporate-driven globalization (e.g. NAFTA and now CAFTA) have compelled many to leave their homes to seek better economic opportunities in the United States. Once here, families back home depend on remittances.

To challenge this paradigm, immigrant groups are intensifying their boycott against Western Union, launched in September of this year. We are boycotting the company until Western Union agrees to adopt a Transnational Community Benefits Agreement. The agreement would force the company to partner in genuine community reinvestment, lower its fees, and establish fairer exchange rates. We have entered into negotiations with other companies in the money transfer industry who are interested in signing a TCBA with TIGRA.

The boycott has already recruited more than 200 immigrant organizations across the United States, with local boycotts launched in at least a dozen cities. Key transnational migrant networks are supporting the campaign, with international launches in Manila, Philippines and Mexico City, Mexico.

The federal Community Reinvestment Act mandates banks to sign community benefit agreements, but no such law exists for the money transfer industry. Yet vulnerable immigrant communities rely on predatory financial institutions like Western Union for money transfers, check cashing, and payday loans. The company’s annual profits of more than $1 billion come directly from these communities.

TIGRA has submitted a shareholder resolution to force Western Union to develop and implement a written policy for community reinvestment that would prioritize building social capital in immigrant communities. As the proposed resolution states, existing corporate practices “increase the risk our Company faces in the competitive consumer market.” Given that Western Union has seen its profits dwindle this year and its stock prices fall, it may be time for the company to generate business the old-fashioned way: listen to its customers.

This immigrant push to make the money transfer industry more accountable is however only one part of a broader effort to work toward making immigration a choice, not a necessity. TIGRA is partnering with migrants worldwide to challenge the neoliberal economic model that is profiting off our love for our families.

Francis Calpotura is Executive Director of the Transnational Institute for Grassroots Research and Action. TIGRA is a national network of more than 200 immigrant organizations in the United States and migrant networks around the world working together to clean up the practices of the money transfer industry to ensure community reinvestment. See

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