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Mobile payment apps attract fraudsters hoping to bilk customers out of their cash. The New York Times recently published a story concerning scammers using the popular Zelle app. And banking services such as Capital One have begun sending out emails warning customers about people impersonating bank employees who demand payments over the phone, text, or email. Clearly something is going on. What do you need to know to stay safe? We'll explain.
Look for the Warning Signs
The United States Federal Trade Commission’s website warns of signs you are being targeted by a banking app scammer. You may receive an email, phone call, or text claiming any one of the following scenarios:
- You won a prize or sweepstakes and need to pay some fees to collect it
- A loved one is in trouble and they need you to send money
- You owe taxes to the IRS
- They’re from tech support and need money to fix a problem with your computer
- They're someone who is romantically interested in you and need some money.
Scammers will then tell you to send them money through a mobile payment app. Do not click on any links contained in an unexpected email or text message. Log in to the payment app to see if you have any requests for money. If you don't, the email or text is probably a phishing scam.
Fraud vs. Scam
On Zelle’s website, the company lays out the difference between being the victim of fraud versus a scam. When it comes to money transfers on cash apps such as Zelle, if someone accessed your account without your authorization and stole your money, you can report the fraud incident to your financial institution, and they may be able to reverse the charges. If you authorized the payment, which often happens in scams where a victim pays for goods or services they do not receive, the financial institution may not give you your money back.
Protect Yourself from Money Transfer Schemes
Do not accept money transfer requests from people or institutions you do not know. Don’t give out personal information to anyone you don’t know online. You can’t always trust caller ID for text messages, as phone numbers can be spoofed and appear to be from someone you know. Verify the identity of the person asking for money with voice calls or by meeting in person