Greg's Corner

Is this the only way for Zelle scam victims to get their money back?

By Greg Collier

The Zelle scam has been garnering headlines since at least last October and shows no signs of relenting. If this is the first you’re hearing about the Zelle scam, this is the scam where bad actors get you to transfer money through the Zelle app to the scammers under the guise of protecting your bank account.

To further clarify, the way the scam works is the scammer will send you a text message that appears to come from your bank. The text message asks if you recently made a large purchase or transfer. You’re asked to reply YES or NO to the text message. If you reply to the text message, you’ll receive a call from the scammer posing as your bank’s fraud department. The scammer will tell you that to protect your money, it needs to be moved through Zelle. What the scammer is really doing is walking you through the directions on how to move your money from your account to the scammer’s account. The scam has become so prevalent that some scammers are even taunting their victims after taking their money.

The banks who co-own Zelle have been inconsistent with whom they deem worthy enough to receive a refund. In the majority of instances, the banks tell scam victims since the victims authorized the transactions, the victims are out of luck. The Zelle platform offers little in the way of consumer protection.

Those who do receive refunds from their banks seem to be those who go to their local media with their stories. It appears the banks are responding to bad press rather than customer concern. While the scammers are ultimately to blame for victims losing their money, there comes a time when a platform has to step up to protect their customers. So far, all that Zelle seems to be doing to protect its users is to wag their finger at the victims who have lost money through their app. How much bad press will it take before Zelle’s owners start implementing precautions to prevent these scams?

If your bank uses Zelle, there are a few ways to protect yourself from this scam. The first is to not respond to text messages that appear to come from your bank. If there is an issue with your account, you’re always better off calling the customer service number on the back of your debit card. You can also visit your bank’s local branch during business hours. The best way to protect yourself is to keep in mind that payment apps like Zelle are only supposed to be used with people you know. If someone says you need to use one of these apps to protect your money, they’re more than likely a scammer.