Western Union 2015 Annual Report Download - page 138

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Risks Related to Our Regulatory and Litigation Environment
As described under Part I, Item 1, Business, our business is subject to a wide range of laws and regulations enacted by the
United States federal government, each of the states (including licensing requirements), many localities and many other countries
and jurisdictions. Laws and regulations to which we are subject include those related to: financial services, consumer disclosure
and consumer protection, currency controls, money transfer and payment instrument licensing, payment services, credit and
debit cards, electronic payments, foreign exchange hedging services and the sale of spot, forward and option currency contracts,
unclaimed property, the regulation of competition, consumer privacy, data protection and information security. The failure by
us, our agents or their subagents to comply with any such laws or regulations could have an adverse effect on our business,
financial condition, results of operations, and cash flows and could seriously damage our reputation and brands, and result in
diminished revenue and profit and increased operating costs.
Our business is subject to a wide range and increasing number of laws and regulations. Liabilities or loss of business resulting
from a failure by us, our agents or their subagents to comply with laws and regulations and regulatory or judicial
interpretations thereof, including laws and regulations designed to protect consumers, or detect and prevent money
laundering, terrorist financing, fraud and other illicit activity, and increased costs or loss of business associated with
compliance with those laws and regulations has had and we expect will continue to have an adverse effect on our business,
financial condition, results of operations, and cash flows.
Our services are subject to increasingly strict legal and regulatory requirements, including those intended to help detect and
prevent money laundering, terrorist financing, fraud, and other illicit activity. The interpretation of those requirements by judges,
regulatory bodies and enforcement agencies is changing, often quickly and with little notice. Economic and trade sanctions
programs that are administered by the United States Treasury Department's Office of Foreign Assets Control prohibit or restrict
transactions to or from or dealings with or involving specified countries, their governments, and in certain circumstances, their
nationals, and with certain individuals and entities such as narcotics traffickers, terrorists and terrorist organizations. As United
States federal and state as well as foreign legislative and regulatory scrutiny and enforcement action in these areas increase, we
expect that our costs of complying with these requirements will continue to increase, perhaps substantially, or our compliance
will make it more difficult or less desirable for consumers and others to use our services or for us to contract with certain
intermediaries, either of which would have an adverse effect on our revenue and operating profit. For example, we made significant
additional investments in 2015 in our compliance programs based on the rapidly evolving environment and our internal reviews
of the increasingly complex and demanding global regulatory requirements. These additional investments relate to enhancing
our compliance capabilities, including our consumer protection efforts. Further, failure by Western Union, our agents, or their
subagents (agents and subagents are third parties, over whom Western Union has limited legal and practical control), and certain
service providers to comply with any of these requirements or their interpretation could result in the suspension or revocation
of a license or registration required to provide money transfer, payment or foreign exchange services, the limitation, suspension
or termination of services, changes to our business model, loss of consumer confidence, the seizure of our assets, and/or the
imposition of civil and criminal penalties, including fines and restrictions on our ability to offer services.
We are subject to regulations imposed by the Foreign Corrupt Practices Act (the "FCPA") in the United States and similar
laws in other countries, such as the Bribery Act in the United Kingdom, which generally prohibit companies and those acting
on their behalf from making improper payments to foreign government officials for the purpose of obtaining or retaining business.
Some of these laws, such as the Bribery Act, also prohibit improper payments between commercial enterprises. Because our
services are offered in virtually every country of the world, we face significant risks associated with our obligations under the
FCPA, the Bribery Act, and other national anti-corruption laws. Any determination that we have violated these laws could have
an adverse effect on our business, financial condition, results of operations, and cash flows.
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