For Mother's Day, Martha Ugarte sent $100 from Los Angeles to her 67-year-old mother in Oaxaca, Mexico. For this, she paid $14.95 to Western Union, and lost another $2 in the exchange rate commission. It's this 17 percent fee that has her outraged, and it explains why she decided to travel across the country to protest outside a midtown Manhattan skyscraper on May 10, where Western Union was holding its first shareholder meeting since spinning off from parent company First Data in 2006.
"My father died last year, and so my mother is on her own," Ugarte says in Spanish as a mariachi band serenades the crowd of protesters and shareholders cast curious glances as they hustle inside. "Every Mother's Day I send money home. It's not OK that Western Union uses this opportunity to charge me such high fees and then refuses to give anything back."
The geographic and ethnic diversity of the crowd of about 100 people assembled here is a testament to our increasingly globalized world. There are Somalis from North Dakota, Salvadorans and Mexicans from New York, Haitians from Florida, Filipinos from California, Kenyans from Washington, DC. All have similar complaints about Western Union. "It doesn't cost companies a lot to send money today," explains Haiti-born Luckner Millien. "Since they depend on immigrants for their profits, it's time that they reinvest some of that money back into our communities."
The immigrants are part of a newly launched campaign by the Oakland-based Transnational Institute for Grassroots Research and Action . TIGRA is advocating for Western Union to adopt a Transnational Community Benefits Agreement (TCBA), which would call on the company to donate $1 for every remittance transaction to a fund to be used for development projects within immigrants' communities in the United States and in their home countries. Last year Western Union made 147 million transactions, which would have been a healthy fund for what would essentially be a Community Reinvestment Act applied to a company that controls 17.4 percent of the remittance market.
"Today, we're putting Western Union and the multibillion-dollar remittance industry on notice," explains TIGRA director Francis Calpotura, himself a Filipino immigrant. "The days of taking advantage of our love are numbered." If implemented, the TCBA would set a precedent for the rapidly growing remittance industry, introducing a new measure of responsibility for corporations whose skyrocketing profits derive from the often dangerous and low-paying work performed by immigrants thousands of miles from home.
With their rapid rise, remittances have become a hot item of discussion within government, public policy and academic circles. As The New York Times Magazine noted in a recent cover story, last year migrants across the globe sent home $300 billion, about three times the $104 billion the world spent on foreign aid. Here in the United States, it is estimated that immigrants sent  $167 billion in 2005. But with all of the newfound focus on remittances, TIGRA is the first organization to see the sending of money as a vehicle for organizing immigrants within an economic justice framework.
The building block of the organizing effort is something called the Million Dollar Club , a group of immigrants whose combined remittances equal or exceed the figure annually. Thus far, TIGRA has formed MDCs in eighteen cities across the country, from predictable locations like Los Angeles and New York City to less likely places such as Fargo and Providence. It's an innovative technique--making "millionaires" out of mostly low-wage immigrants--but as a movement-building tactic it has historical echoes in the farmer cooperatives organized by the populists in the nineteenth century.
That Western Union has profited richly from poor immigrants is beyond doubt. By far the largest player in the remittance industry, Western Union recently purchased one of its competitors, Vigo. In 2006 Western Union's profits were nearly $1 billion, and in the past five years the company has nearly tripled the number of outlets, which today stand at 305,000 worldwide (for comparison, there are 31,000 McDonald's restaurants  in the world). The CEO of Western Union, Christina Gold, was named one of the fifty most powerful businesswomen by Fortune magazine in 2006, earning a $16.5 million compensation package. It's no wonder Gold feels that her company is in "a unique and desirable position."
Just how desirable is underscored by a 2006 World Bank report  on remittances. The report cites Western Union's exceptionally high profit margins in the remittance industry--the last several years averaging about 30 percent, nearly twice its peer group average--and concludes that Western Union could reduce average fees by one-third and still provide operating margins comparable to competitors like MoneyGram . The World Bank also conducted an analysis of the average cost of a single remittance. For immigrants like Ugarte who send the same amount to the same recipient regularly, it costs an estimated $3.60 for Western Union to complete the transaction--almost one-fifth of what Ugarte paid.
Western Union can get away with charging such high fees in part because of its massive agent distribution advantage, with three times the number of locations as MoneyGram. But as more money-transfer companies and banks move into the field, Western Union may be forced to lower fees--as it has begun to do in certain locations--and compete for customers. One way to draw new customers in would be to highlight its commitment to reinvesting for community development.
Western Union argues that it is already deeply committed to this cause. Spokesperson Daniel Diaz points to the $40 million the company has donated since 2001, focusing on disaster relief, education and human services. He also noted that in 2005 Western Union launched a new community development partnership with the Mexican government to build upon its "three for one" program, which matches three dollars from the Mexican government with each dollar raised by hometown associations for public works projects. With a $1.25 million investment , Western Union has created a "Four Plus One" program in five Mexican states.
This doesn't satisfy Julie Goodridge, the CEO of Northstar Asset Management, who is a Western Union shareholder and a member of Responsible Wealth (a project of United for a Fair Economy). Goodridge has filed a shareholder resolution calling for an examination of Western Union's remittance practices, which was challenged by the company and later rejected by the Securities and Exchange Commission (SEC). She'll be filing another resolution in the future.
"Sure, they give money back," says Goodridge. "Every corporation gives money back to the community, even one like Altria [formerly Phillip Morris]. The question is, how much?"
Western Union's total profits for the previous six years were more than $4 billion; with $40 million in donations during that time, the company has given less than $1 for every $100 it earned in profit. Wal-Mart--not exactly the poster child for corporate responsibility--has a corporate giving rate  of more than twice that, donating $2.23 for every $100 profit in 2006.
"For an immigrant earning the minimum wage in New York City, it takes a full week of work to pay off the fees Western Union charges during a year of sending money home," complains Artemio Guerra, an organizer with the Brooklyn-based Fifth Avenue Committee. "Where does [CEO] Gold think her $16 million income comes from, anyway? She's lining her pockets with the money earned by Mexican dishwashers, Chinese construction workers and Jamaican childcare providers. The least she can do is show some gratitude and put a small portion of the profits back into their communities."