Western Union 2015 Annual Report Download - page 146

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In addition, in connection with regulatory requirements to assist in the prevention of money laundering and terrorist financing
and pursuant to legal obligations and authorizations, Western Union makes information available to certain United States federal,
state, and foreign government agencies when required by law. In recent years, Western Union has experienced increasing data
sharing requests by these agencies, particularly in connection with efforts to prevent terrorist financing or reduce the risk of
identity theft. During the same period, there has also been increased public attention to the corporate use and disclosure of
personal information, accompanied by legislation and regulations intended to strengthen data protection, information security
and consumer privacy. These regulatory goals - the prevention of money laundering, terrorist financing and identity theft and
the protection of the individual's right to privacy - may conflict, and the law in these areas is not consistent or settled. The legal,
political and business environments in these areas are rapidly changing, and subsequent legislation, regulation, litigation, court
rulings or other events could expose Western Union to increased program costs, liability and reputational damage.
We are subject to unclaimed property laws, and differences between the amounts we have accrued for unclaimed property
and amounts that are claimed by a state or foreign jurisdiction could have a significant impact on our results of operations
and cash flows.
We are subject to unclaimed property laws in the United States and abroad which require us to turn over to certain government
authorities the property of others held by us that has been unclaimed for a specified period of time, such as unpaid money
transfers. We have an ongoing program to help us comply with those laws. In addition, we are subject to audits with regard to
our escheatment practices. Any difference between the amounts we have accrued for unclaimed property and amounts that are
claimed by a state or foreign jurisdiction could have a significant impact on our results of operations and cash flows. See
"Unclaimed Property Regulations" for further discussion.
Our consolidated balance sheet may not contain sufficient amounts or types of regulatory capital to meet the changing
requirements of our various regulators worldwide, which could adversely affect our business, financial condition, results of
operations, and cash flows.
Our regulators expect us to possess sufficient financial soundness and strength to adequately support our regulated
subsidiaries. We had substantial indebtedness as of December 31, 2015, which could make it more difficult to meet these
requirements if such requirements are increased. In addition, although we are not a bank holding company for purposes of United
States law or the law of any other jurisdiction, as a global provider of payments services and in light of the changing regulatory
environment in various jurisdictions, we could become subject to new capital requirements introduced or imposed by our
regulators that could require us to issue securities that would qualify as Tier 1 regulatory capital under the Basel Committee
accords or retain earnings over a period of time. Also, our regulators specify the amount and composition of settlement assets
that certain of our subsidiaries must hold in order to satisfy our outstanding settlement obligations. These regulators could further
restrict the type of instruments that qualify as settlement assets or these regulators could require our regulated subsidiaries to
maintain higher levels of settlement assets. For example, we have seen increased scrutiny from government regulators regarding
the sufficiency of our capitalization and the appropriateness of our investments held in order to comply with state and other
licensing requirements. Any change or increase in these regulatory requirements could have a material adverse effect on our
business, financial condition and results of operations.
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