Man loses $7500 in new Zelle scam

Man loses $7500 in new Zelle scam

By Greg Collier

Next month, it will be a year since we started posting about Zelle scams. In that time, it doesn’t seem like much has been done on Zelle’s side to protect its users from scams. However, the scammers seem to have adapted the Zelle scam to continue stealing from their victims.

For those who may be new readers, Zelle is a personal payment app that’s co-owned by some of the country’s biggest banks. It’s a competitor to apps like Venmo and Cash App. Zelle us only supposed to be used between family and friends and is not intended to be used for business purposes.

In the previous version of the scam, scammers would send victims a text message posing as their bank’s fraud department. The text asks the victim if they recently made a large purchase and text back either yes or no. Once the victim texts back, that lets the scammers know that there is someone at that phone number.

That text message is then followed up with a phone call to the victim. Still posing as the bank’s fraud department, the scammers tell the victim that their bank account has been compromised. The victim is then told that in order to protect the money in their account, the money needs to be ‘moved’. Instructions are given to the victim on how to move the money, but what’s really happening is the scammers are walking the victim through a procedure where their money is given to the scammers through Zelle.

In the new Zelle scam, instead of walking the victim through instructions on transferring the money through Zelle, the scammers are now hijacking the victim’s Zelle account. The scammers do this by asking the victim for a security code that the scammers say they need for security purposes. What the scammers are actually doing is triggering a password rest on the victim’s Zelle account. The security code is needed to complete the password change. Giving the security code to scammers is essentially handing over your Zelle account to them.

This recently happened to a man in Arizona who received an email about a fraudulent charge. When he called the number on the email to dispute the charge, he was told to pay himself the charge amount through Zelle to reverse the fraudulent charge. However, the ‘bank’ needed the security code to complete the transaction. This is being referred to as the ‘pay yourself scam’. After the scammers hijacked the man’s account, they took $7500 from him.

Zelle has released a video on how to prevent yourself from becoming a victim of this scam, as you can see below. But are they really doing enough to educate bank customers on how Zelle can be used to scam them. Part of the problem is that many of the banks that use Zelle make Zelle part of their own app. Many customers aren’t even aware that they have Zelle or how to use it. In some cases, Zelle can be used to access a bank account, whether that customer wants it to happen or not. Zelle needs to better educate and protect their customers before their name becomes synonymous with scams, if it hasn’t already.