Ripple's giant partner, payment company MoneyGram, has also been sued because of its lawsuit with the SEC. The reason is not to provide accurate information to the investor and to make misleading statements.
A class action lawsuit was filed against MoneyGram, a US-based inter-country money transfer company, for its misleading policy in its partnership with Ripple Labs. The process of the lawsuit filed on behalf of investors who bought securities from MoneyGram between June 2019 and February 2021 officially started yesterday.
MoneyGram, which suspended its partnership with Ripple following the SEC's lawsuit, allegedly made fraudulent statements about its partnership with Ripple Labs and the status of XRP as a security, according to global investor rights rules. According to the strategic partnership between the two companies in June 2019, MoneyGram used Ripple's xRapid product and made deals using XRP as part of the cross-border payment process.
However, in the statement made by the company on December 23, it was emphasized that there is no dependence on Ripple's service, formerly xRapid and the new name is Liquidity on Demand (ODL), in cross-border exchange transactions, and said, “MoneyGram does not use the ODL platform or RippleNet for the transfers of customer funds. and it is not a party in the SEC case ”.
Law firm Rosen, who filed the case on behalf of clients, claims that MoneyGram did not explicitly state that XRP was viewed by the SEC as an unregistered and illegal security. The law firm also notes that if the SEC obliges Ripple to enforce securities laws, it could miss out on the serious gains needed for MoneyGram's financial continuity.
The end date of the partnership between the two companies was indicated as 2023, and Ripple also agreed to invest $ 50 million with MoneyGram. Ripple was also paying MoneyGram for using its platform. In 2020, MoneyGram received $ 38 million in payments from Ripple.