Arizona authorities are moving to broaden their efforts to seize money transmissions intended for smugglers of drugs and people.
According to court papers filed by Western Union Financial Services Inc., the Attorney General’s Office is asking a state judge to issue a warrant allowing authorities to seize large cash transmissions sent to 26 specific locations in the Mexican state of Sonora even if the money is sent directly to Mexico from a state other than Arizona.
Arizona already has a program to seize wire transmissions of money allegedly related to smuggling and sent to or from Arizona, but the proposed expansion would also cover transfers of $500 or more of cash sent from 28 U.S. states to specified places in Sonora, attorneys for Englewood, Colo.-based Western Union said in a complaint filed in U.S. District Court.
Authorities say wire transmissions of money are used to move cash being paid to smugglers of people and drugs and that seizing the money is a deterrent to those crimes because it reduces the profit motive.
Attorney: Move would hurt business, violate protections
Western Union’s lawyers argued that the state’s plan for broadened seizures would damage the company’s business by scaring off customers and violate constitutional protections for intestate and international commerce, but Judge Stephen M. McNamee on Wednesday denied Western Union’s request for a temporary restraining order.
Assistant Attorney General Cameron H. Holmes, chief counsel of the office’s financial remedies section, told McNamee that the seizures are based on a reliable screening process, subject to state court supervision and legal because the money that would be seized was tied to smuggling activities in Arizona.
“Everything they do is centered in Phoenix,” said Mr. Holmes. “All that matters is that we have an Arizona crime and Western Union has the power to direct that money to us.”
Western Union attorney Francis J. Burke Jr. argued that people in other states and countries should not have to deal with Arizona authorities to win release of seized wire transfers. “The only way they get it back is to be interrogated by a detective in Arizona,” he said.
Mr. Holmes said people trying to claim money subject to possible seizure are questioned by detectives but given the benefit of the doubt. Of those that went to court, “we have never lost any of these cases,” he said.
Outside the courtroom, Mr. Holmes declined to discuss the status of the seizure warrant request pending in Maricopa County Superior Court. However, Mr. Burke said a warrant could be served on Western Union within a matter of days.
Earlier this week, a Superior Court judge ruled that Western Union had to obey a subpoena to provide the Attorney General’s Office with data on wire transactions to recipients in Sonora. Western Union had disputed whether the office had jurisdiction to issue the subpoena.
Separately, Western Union last month reached a $3 million settlement with the Arizona Department of Financial Institutions on allegations that some of the company’s outlets in Arizona failed to comply with state reporting laws intended to help combat money laundering and illegal immigration.
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