Western Union (WU) risk factors, FY2024 10-K

Risks Relating to Our Business and Industry

1. 01We face credit, liquidity, and fraud risks from our agents, consumers, businesses, and third-party processors
2. 02Changes in tax laws, including as a result of the Pillar 2 Directive defined and discussed below, or their interpretation, and unfavorable resolution of tax contingencies could adversely affect our tax expense

Risks Relating to Our Regulatory and Litigation Environment

1. 03The changes in our compliance program required by the consent orders and settlement agreements to which we are party have had, and may continue to have, adverse effects on our business
2. 04fines, or penalties. Responding to litigation, investigations or enforcement actions also diverts considerable time and resources from management and, regardless of the outcome, can result in significant legal expense

Risks Relating to our Business Model and Competition

1. 05Our agents or clients could experience reduced sales or business as a result of a deterioration in economic conditions. As a result, our agents could reduce their numbers of locations or hours of operation or cease doing business altogether
2. 06The market value of the securities in our investment portfolio may substantially decline. The impact of that decline in value may adversely affect our liquidity, financial condition, and results of operations
3. 07If market disruption or volatility occurs, we could experience difficulty in accessing capital on favorable terms, and our business, financial condition, results of operations, and cash flows could be adversely impacted
4. 08If customer confidence in our business or in consumer money transfer and payment service providers generally deteriorates, our business, financial condition, results of operations, and cash flows could be adversely affected
5. 09any breach of our computer systems or other data storage facilities, or of certain of our third-party providers, resulting in a compromise of personal or other data
6. 10Our ability to adopt new technology and develop and gain market acceptance of new and enhanced products and services in response to changing industry and regulatory standards and evolving customer needs poses a challenge to our business
7. 11Risks associated with operations outside the United States and foreign currencies could adversely affect our business, financial condition, results of operations, and cash flows
8. 12We face credit, liquidity, and fraud risks from our agents, consumers, businesses, and third-party processors that could adversely affect our business, financial condition, results of operations, and cash flows
9. 13The liquidity of our agents and other parties we transact with directly, including merchant acquirers, is necessary for our business to remain strong and to continue to provide our services. If our agents or other partners fail to settle with us in a timely manner, our liquidity could be affected

Risks Relating to Cybersecurity and Third-Party Vendors

1. 14Breaches of our information security safeguards could adversely affect our ability to operate and could damage our reputation and adversely affect our business, financial condition, results of operations, and cash flows
2. 15Interruptions in our systems, including as a result of cyber attacks, or disruptions in our workforce may have a significant adverse effect on our business
3. 16We receive services from third-party vendors that would be difficult to replace if those vendors ceased providing such services adequately or at all. Cessation of or defects in various services provided to us by third-party vendors could cause temporary disruption to our business

Risks Relating to Acquisitions, Divestitures, and Restructuring Activities

1. 17Acquisitions and integration of new businesses create risks and may affect operating results
2. 18general economic and political conditions, including legal and other barriers to cross-border investment in general, or by United States companies in particular
3. 19Divestitures and contingent liabilities from divested businesses could adversely affect our business and financial results
4. 20We may not realize the anticipated benefits from the introduction of new business services, and we may experience disruptions in our Company and our workforce as a result of attempting these initiatives
5. 21We may not realize all of the anticipated benefits from restructuring and other related initiatives, which may include decisions to downsize or to transition operating activities from one location to another, and we may experience disruptions in our workforce as a result of those initiatives

General Risks

1. 22Changes in tax laws, or their interpretation, and unfavorable resolution of tax contingencies could adversely affect our tax expense
2. 23Our business, financial condition, results of operations, and cash flows could be harmed by adverse rating actions by credit rating agencies
3. 24Our ability to remain competitive depends in part on our ability to protect our trademarks, patents, and other intellectual property rights and to defend ourselves against potential intellectual property infringement claims
4. 25Our intellectual property rights are an important element in the value of our business. Our failure to take appropriate actions against those who infringe upon our intellectual property could adversely affect our business, financial condition, results of operations, and cash flows
5. 26Material changes in the market value or liquidity of the securities we hold may adversely affect our results of operations and financial condition
6. 27As of December 31, 2024, we had approximately $2.9 billion in consolidated indebtedness, and we may also incur additional indebtedness in the future. Furthermore, the Tax Act imposes a tax on certain of our previously undistributed foreign earnings, and we are required to pay the final installment in 2025
7. 28limiting our ability to borrow additional funds; and
8. 29Failure to attract, retain, and develop the key employees we need to support our objectives could have a material adverse impact on our business

Risks Relating to Significant Regulatory Requirements

1. 30obligations under the FCPA, the Bribery Act, and other national anti-corruption laws. Any determination that we have violated these laws could have an adverse effect on our business, financial condition, results of operations, and cash flows
2. 31Our fees, profit margins, and/or foreign exchange spreads may be reduced or limited because of regulatory initiatives and changes in laws and regulations or their interpretation and industry practices and standards that are either industry wide or specifically targeted at our Company
3. 32The effect of the Dodd-Frank Act, the EFTA, Regulation E, and the CFPB on our business and operations has been and will continue to be significant, and the application of the associated implementing regulations to our business may differ from the application to certain of our competitors, including banks
4. 33Current and proposed regulation addressing consumer privacy and data use and security could increase our costs of operations, which could adversely affect our operations, results of operations, and financial condition
5. 34We are subject to unclaimed property laws, and differences between the amounts we have accrued for unclaimed property and amounts that are claimed by a state or foreign jurisdiction could have a significant impact on our results of operations and cash flows

Risks Relating to Consent Agreements and Litigation

1. 35Our business is the subject of consent agreements with, or investigations or enforcement actions by, regulators and other government authorities