Suit Says Firms Hid Fees for Wiring Funds

The Western Union and MoneyGram companies have been accused of failing to tell customers that the firms deducted a currency conversion fee from funds wired to victims of Hurricane Pauline in Latin America.

Attorney Fred J. Kumetz said in a federal lawsuit filed Monday that despite announcing that they would wire money to the hurricane victims without charge, the firms subtracted a fee of about 10% for converting dollars into Mexican pesos and other Latin American currencies.

Also named in the class-action lawsuit is the Ralphs grocery chain, which ran advertisements announcing “free” money transfers, Kumetz said.

Warren Bechtel, a spokesman for MoneyGram in Saddle Brook, N.J., said that MoneyGram and Western Union promised to waive the normal transfer fee to victims of Hurricane Pauline “for a specified period of time, and we did that. . . .”

“But the currency exchange fee is a separate issue,” Bechtel said. “That was charged as usual. There was nothing in the offer that waived the normal exchange fee.”