MoneyGram International Sued for Issuing Misleading Statement Regarding XRP

By: Mark Jessy

MoneyGram International Sued for Issuing Misleading Statement Regarding XRP

March 2, 2021 11:52 AM

The payment company MoneyGram international is facing a class-action lawsuit for allegedly issuing misleading statements after failing to mention XRP status as unlicensed security.


MoneyGram International who became a Ripple partner in 2019, has received a lawsuit in California over the payment company association with Ripple Labs and failing to identify XRP as a security. 


On March 1, the lawsuit was filed in California and submitted on behalf of investors who acquired securities from MoneyGram International between these dates June 17, 2019, and February 22, 2021. 


Global investor's rights legal practice proclaims that the payment company made deceitful announcements regarding its partnership with Ripple Labs.


In June 2019, MoneyGram announced its strategic partnership with Ripple. The announcement asserted that " MoneyGram will Utilize Ripple's xRapid product, by leveraging XRP in foreign exchange settlements.


However, MoneyGram has tried to distant itself from XRP and Ripple Labs. On December 23, 2020, The company clarified that it is not a pendant on Ripples xRapid or the now ODL after it was rebranded in 2019, to service its foreign exchange settlements.


“MoneyGram does not utilize the ODL platform or RippleNet for direct transfers of consumer funds digital or otherwise. Furthermore, MoneyGram is not a party to the SEC action," the company stated.


As previously reported by Coinnewsafrica, MoneyGram suspended its partnership with Ripple Labs in late February in a bid to evade the U.S. Security and Exchange Commission (SEC) sanctions after they filed a complaint against Ripple in December 2020 on a likely securities violation.


Rosen a global investor rights law firm, announces that MoneyGram international failed to reveal that XRP was viewed as unregistered security by the SEC.


As reported that MoneyGram received $12.1 million in Ripple market development fees in Q1 2020.


The agreement between MoneyGram and Ripple was set to end in 2023, with the fintech company also have agreed to invest up to $50 million in MoneyGram.