If you have ever used an app for your bank, you may be familiar with Zelle. It’s become the most common way for banks to offer peer-to-peer payment, offering an alternative to the popular app Venmo. The platform makes it easy to exchange money and easy for scammers to steal it.
With Zelle, you can send money directly from your bank account to someone using just their email or cell phone number. While it’s wildly simple to use, the number of scams revolving around Zelle has significantly risen in recent years, and even more in recent months.
We have the most frequently used scams on Zelle and the red flags to watch out for so you don’t become the next victim of fraud.
Zelle payment scams
Due to the increasing number of fraudulent payments on peer-to-peer payment apps like Zelle, the company released a statement last month claiming the number of scams reported is just 0.01%.
Safe Payments: More than 99.9% of payments are sent without any report of fraud or scams.
– Zelle
However, according to reports nationwide, that number must be higher based on the sheer number of scams occurring on Zelle daily.
Many are concerned about the uptick in fraud while using Zelle because your account is attached to your bank account, but banks don’t want to cover the lost funds. Zelle is owned by a parent company, Early Warning Services, which is co-owned by seven popular banks:
- Bank of America
- Truist
- Capital One
- JPMorgan Chase
- PNC Bank
- U.S. Bank
- Wells Fargo
Victims claim Zelle is not taking the side of the victim in these fraudulent cases, citing they sent the money on their own accord from their bank account. In order to avoid this happening to you, first watch out for these popular scams going around on Zelle.
Most common Zelle scams
Fake notice on suspended services
Victims have reported being contacted regarding overdue payments on a service such as an electric bill. You may receive a phone call from someone claiming to be from your electric company telling you if you don’t pay immediately, your power will go off. Then you’ll be given an excuse about how they’ve had trouble with payment, so you need to use Zelle.
The major red flag here is you’ll never be contacted by these companies via phone, text, or email with a demand for payment. Major electric companies also won’t accept payment via apps like Zelle or Venmo, so be wary of anyone asking for immediate payment in that way.
Overpayment scam
Some Zelle scammers will try and convince you you’ve overpaid for an item, sometimes via an email about a product they claim you’ve purchased. This is also a common scheme while selling items on sites like Facebook Marketplace – the scammer will offer to buy something and then overpay you for it. You will then be asked to return the excess money. The problem? This money never existed – so when Zelle catches up 2-3 days later, that money will be taken from YOUR account, and the scammers will still have what you sent over.
Fake credit card linked to Zelle account
Scammers may link a fake or stolen credit card to a Zelle account, and try and complete a transaction (usually on something pricier – like a TV). You’ll accept the payment on Zelle and give them the item, but once that money or credit card is reported stolen, that money will once again be taken out of YOUR account. Now they have what you sold them, along with the money they sent you for it.
How to protect yourself against scams on Zelle
- Only interact with people you know on Zelle. Do not send or receive money from anyone you don’t know.
- Link your Zelle account to a credit card as opposed to a debit card, so you can dispute a charge from scammers more easily
- Turn on 2-factor authentication on your banking app – and NEVER give out a code texted to you in a 2FA, even if you didn’t request it.
- Get alerts from your bank via text or email so you’re aware if your account finds any suspicious activity
- Never click on links from unknown sources especially when an email or text appears to have come from the Cash App. Protect yourself from accidentally clicking malicious links by running antivirus software on your device. Get my picks for best antivirus software here.
- Look at the security settings that Zelle offers and make sure they’re all set to the highest and most protective settings
What should you do if you think you’ve been scammed?
Contact your bank
If you sent money to a scammer and want to get it back, you should immediately reach out to your bank or credit/debit card company and report it as fraud. The representatives will then walk you through the steps of how to get your money reimbursed.
Visit IdentityTheft.gov
If you gave out any personal information to a scammer like a social security number, follow the steps at IdentityTheft.gov. You’ll be able to make a report there and the website will help come up with a recovery plan for you and walk you through each step of gaining your identity back.
Use Identity theft protection
If you want a service that will walk you through every step of the reporting and recovery process, one of the best things you can do to protect yourself from this type of fraud is to subscribe to an identity theft service. My top recommendation is Identity Guard.
Identity Guard will monitor personal information like your Social Security Number (SSN), phone number, and email address and alert you if it is being sold on the dark web or being used to open an account. They can also assist you in freezing your bank and credit card accounts to prevent further unauthorized use by criminals.
One of the best parts of using Identity Guard includes identity theft insurance of up to 1 million dollars to cover losses and legal fees and a white glove fraud resolution team where a US-based case manager helps you recover any losses.
Special for CyberGuy Readers: Save up to 51% with my top recommendation is Identity Guard.
Read more of my review of best identity theft protection services here
Have good antivirus software on all your devices
Having antivirus software on your devices will make sure you are stopped from clicking on any potential malicious links that may be sent in any of your emails or text messages.
Special for CyberGuy Readers: My #1 pick is TotalAV, and you can get a limited-time deal for CyberGuy readers: $19 your first year (80% off) for the TotalAV Antivirus Pro package.
Find my review of Best Antivirus Protection here.
Suspicious apps found on Apple iPhone and Android – Delete ASAP
More scams:
- The ‘Unsubscribe’ email scam is targeting Americans
- New LinkedIn scam to watch out for
- Microsoft phishing scam – Don’t click that email
- Protect yourself from tech support scams
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