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The world’s second largest money services business must pay nearly $35,000 for allegedly violating several U.S. sanctions programs over a seven-year period, including by handling funds for federal inmates on the Treasury Department’s list of specially designated nationals, or SDNs.

From March 2013 to January 2015, Dallas-based Moneygram routed payments to and from the commissary accounts of incarcerated individuals under a contract with the Justice Department’s Federal Bureau of Prisons, or BOP, without screening them against the SDN list, the Treasury Department’s Office of Foreign Assets Control disclosed Thursday.

“Moneygram knew that some of the inmates for whom it was processing transactions could be on the SDN list, but it erroneously believed that such screening of inmates in federal prison was not expected under the BOP program,” OFAC found in a 3-page settlement with the company.

The money services business, or MSB, eventually began vetting commissary transactions for sanctions purposes but because of related screening deficiencies, technological mishaps, “limited instances of human error” and “fuzzy logic,” continued to approve payments to and from blacklisted prisoners before its contract with the Justice Department expired in April 2016.

Human error was also the culprit behind the company’s decision to separately handle Syria-linked commercial transactions for two unidentified individuals at some point between March 2013 and June of last year.

Moneygram employees incorrectly identified the payments as personal, permissible remittances, OFAC found.

“In total, between March 12, 2013 and June 21, 2020, MoneyGram processed 359 transactions totaling $105,627 on behalf of approximately 40 individuals on the SDN List, as well as for two individuals who initiated commercial transactions involving Syria,” the agency found.

The transactions apparently violated U.S. sanctions programs that target drug traffickers and proliferators of weapons of mass destruction, as well as OFAC’s country-specific restrictions against Syria and the Democratic Republic of Congo.

Customer attestations and payment details should have prompted Moneygram to refuse to handle the transactions, according to OFAC.

The low penalty announced Tuesday, however, reflects the agency’s finding that the violations were not egregious in nature, and recognition that the company voluntarily reported them.

Contact Colby Adams at cadams@acams.org