What do the scams actually look like?
Consumers defrauded on Zelle are left high and dry by the banks that created it [pdf]
31–40 of 105 posts
Re: Consumers defrauded on Zelle are left high and dry by the banks that created it [pdf]
#32Earlier quoted context omitted.
There is no way to do what the senators want without undermining the entire point of Zelle. If there are chargebacks then there needs to be a dispute resolution system and higher fees to compensate. These are authorized payments, banks are already obligated to reimburse all unauthorized payments.
I don't think you are getting the Senate report's point. It's titled "How Consumers Defrauded on Zelle are Left High and Dry by the Banks that Created It " When you say it would undermine the entire point of Zelle, I don't think that's the Senate's concern. I think the Senate's concern is that banks have created a money transfer system where they eschew their legal obligation to reimburse all unauthorized payments.
But a payment as part of a fraud is often an nauthorized payment. This is what people don't realize. An authorized payment is one that you agreed to make; if you didn't get what you expected in return, that doesn't make the payment unauthorized.
Banks have no legal obligation to refund authorized payments, any more than they have obligations to refund people who took cash out of ATMs that they lost as part of a fraud.
Re: Consumers defrauded on Zelle are left high and dry by the banks that created it [pdf]
#33"Consumers defrauded with cash are left high and dry by the Federal Reserve Bank that created it".
Did the Federal Reserve promise me that cash was always "safe, fast and convenient?" Are they getting a cut of every dollar I spend?
Re: Consumers defrauded on Zelle are left high and dry by the banks that created it [pdf]
#34Due to Zelle's low transaction limits the amount lost in Zelle scams is hardly worth noting. Every bank already has a warning page before you use Zelle telling people what to look for in scams but based on this report it appears people are ignoring it. The losses from investment scams are much more worrying. I think all consumer bank accounts should require a mandatory two hour anti scam educational video before any…
Low transaction limits? I regularly send $xx,xxx through zelle. Guess I got to up my game..
Re: Consumers defrauded on Zelle are left high and dry by the banks that created it [pdf]
#35Earlier quoted context omitted.
I don't think that one can't add security and verification, etc. I think the issue is those things are not free and it is supposed that adding them would just transform Zelle into something more akin to a credit card, which we already have. In your example it seems you did actually send it to the school. The problem was an additional party also had access to school accounts, even if old. To me that's equivalent to a…
I agree with you. It was just fascinating to me how in hindsight I couldn't access the full digital trail of those funds and other people wouldn't just reveal it to me on account of privacy. As other people have pointed out, the courts would be needed, because even though I showed them evidence with some screenshots, etc, I suppose I could have fabricated those to cause trouble for someone.
The cops don't care enough to do the paperwork and get the subpoenas. Next time suggest that the ex school employee is a terrorist. The KYC compliance and financial crime divisions won't get activated if you don't push the issue. Your average city cop just doesn't give enough of a damn. The paper trail and financial surveillance systems are there, you just have to make them pursue it.
Re: Consumers defrauded on Zelle are left high and dry by the banks that created it [pdf]
#36It's not just fraud you need to worry about. Here's a horror story for you. A few years back I was moving to a city for graduate school and needed to rent an apartment. A friend of mine toured the place and when we decided to rent the landlord asked if we could send him the security deposit using Zelle. I sent the deposit using his contact information, but he never received it.
I spent three weeks being passed back and forth by one bank being told I needed to speak with they other bank. They confirmed the money had been debited from my account, and confirmed it was not deposited in his, but nobody could tell me where the money went. I called Zelle multiple times, but all they would tell me is I needed to talk to the banks. Eventually after three weeks the money was quietly returned to my account with no explanation. After a bit more digging it appears my transaction triggered some fraud alert, but neither myself, the depositor, or either bank was notified of this.
To add insult to injury, during this process the people in charge of Zelle at my bank (which rhymes with Space) told me I was out of luck, because using the Zelle for any type of commercial transaction, including sending rent or security deposits, is against the terms of service. Looking back over the terms of service I found they were 100% correct.
I also found that Zelle is basically just a front-end for the existing ACH Direct Deposit system. It was created by a consortium of banks to compete with services like Venmo, but it at it's core a very different service. Venmo actually provides value by acting as a middle man: Venmo pays the recipient and collects the money from me. Zelle is just a way to send money directly to someone's checking account, but by using their email address or phone number instead of the account and routing number. This is why there is absolutely no recourse if anything goes wrong.
tl;dr do not ever use Zelle.
Re: Consumers defrauded on Zelle are left high and dry by the banks that created it [pdf]
#37Due to Zelle's low transaction limits the amount lost in Zelle scams is hardly worth noting. Every bank already has a warning page before you use Zelle telling people what to look for in scams but based on this report it appears people are ignoring it. The losses from investment scams are much more worrying. I think all consumer bank accounts should require a mandatory two hour anti scam educational video before any…
Low transaction limits? I regularly send $xx,xxx through zelle. Guess I got to up my game..
Do you have a business account? I have a $1500/day limit. Looking it up it seems like for popular banks it tops out at $2500/day, and some go as low as $500/day.
Re: Consumers defrauded on Zelle are left high and dry by the banks that created it [pdf]
#38Earlier quoted context omitted.
There is no way to do what the senators want without undermining the entire point of Zelle. If there are chargebacks then there needs to be a dispute resolution system and higher fees to compensate. These are authorized payments, banks are already obligated to reimburse all unauthorized payments.
I see other comments here saying it's intended to be digital cash, but as a programmer it makes no sense that we Zelle users cannot find out the identify and ultimate destination on the other side of the funds transfer - it's also annoying that the USA doesn't have a simple bank transfer system like many other countries do. About 4 years ago, I got scammed when I sent a payment to a local preschool and later found ou…
My banks Zelle integration tells me the name of the other account and will specifically alert me if my Zelle "contact" name is different than the actual name on the account.
Re: Consumers defrauded on Zelle are left high and dry by the banks that created it [pdf]
#39Due to Zelle's low transaction limits the amount lost in Zelle scams is hardly worth noting. Every bank already has a warning page before you use Zelle telling people what to look for in scams but based on this report it appears people are ignoring it. The losses from investment scams are much more worrying. I think all consumer bank accounts should require a mandatory two hour anti scam educational video before any…
Low transaction limits? I regularly send $xx,xxx through zelle. Guess I got to up my game..
At which bank?
The highest available limit I can find is $5,000 per day, and that's limited to private clients and businesses:
https://www.gobankingrates.com/banking/mobile/zelle-limits/
Common limits vary between $500 and $2,500 as you can see.
I've never heard of anyone being able to use it to send $10K in a single transaction, so it would be very helpful to know where you can do that.
Re: Consumers defrauded on Zelle are left high and dry by the banks that created it [pdf]
#40It's not just fraud you need to worry about. Here's a horror story for you. A few years back I was moving to a city for graduate school and needed to rent an apartment. A friend of mine toured the place and when we decided to rent the landlord asked if we could send him the security deposit using Zelle. I sent the deposit using his contact information, but he never received it. I spent three weeks being passed back a…
You should write that up as an Op-Ed or contact some journalists to use it as part of a story.
You've got a lot of details in there that are definitely not common knowledge and would be of wide interest.