Common Zelle scams to protect your money against

Anton P. | September 12, 2022

Zelle scams attempt to exploit instant and irreversible P2P payments. Such trickery heavily relies on social engineering and can happen through platforms like Facebook Marketplace and email. Criminals tempt victims with concert tickets, household items, or other intriguing propositions, prompting targets to transfer funds to scammers.

However, P2P payment applications lack protection for transactions that users authorize willingly. So, consumers should beware of Zelle scams and be cautious whenever transferring money to unknown entities.

zelle scams

Why are Zelle scams popular?

There is an apparent downside of P2P payment apps, enabling many Zelle scams. Unlike debit or credit cards, such services do not offer much protection against fraud.

For instance, you can cancel pending money transfers. Sadly, reclaiming your transaction is nearly impossible once Zelle forwards funds to their destinations.

Therefore, Zelle emphasizes that their service should only be used when sending funds to trusted entities. Similar precautions are necessary to avoid fraud on other payment systems, like CashApp scams.

Zelle is a US-based peer-to-peer payment network facilitating quick financial transactions. Its owners are Early Warning Services LLC, an association between major banks like Bank of America and Wells Fargo.

Zelle’s biggest attraction might be free transfers and their quick delivery. You and your friends might use different bank providers, but you can still send or receive the money within minutes.

How can you get scammed on Zelle?

Zelle scams can happen on two levels:

  • When someone gains unauthorized access to your Zelle account and makes transactions.
  • Scammers somehow prompted you to make transactions and authorize them.

According to Precedence Research statistics, the P2P payment market could reach $9.87 trillion by 2030. Considering such impressive growth trends, the pool of potential victims will deepen even more.

When victims have their accounts taken over

The only solid way to have a claim for reimbursement from Zelle is when attackers take over your account. However, it needs to happen with no cooperation from the victim.

For instance, deliberately handing your Zelle login credentials can revoke all calls for lost funds. So, a malicious attack like credential stuffing needs to be in play.

When victims authorize payments

Criminals can craft calculated Zelle scams for deceiving users. A recent incident involved a minor selling his computer online. The victim found a potential buyer willing to pay $500. However, the unsuspecting seller then received emails from entities that claimed to be from Zelle.

The messages indicated that the victim could not receive $500 due to limits on his bank account. Initially, fraudsters instructed the victim to send $500 to the computer buyer’s account. After this transaction, hustlers required $200 and $400 fees.

The $500 payment went through to the scammers’ accounts, but the victim managed to cancel the two pending transactions.

Another scam convinced a woman from Coral Gables to send $3,000 to scammers. This and similar Zelle scams can involve criminals pretending to be from Bank of America and spoofing its official number.

Fake Zelle representatives claimed they needed the victims’ login details to reverse a transfer. Later, she realized it was a scam but had no claim for compensation for her losses.

Common Zelle scams and red flags to look for

Sadly, such Zelle scams are far from one-off incidents. Scammers impersonate Zelle staff, post bogus marketplace items, or spoof phone numbers. Even more unfortunate, Zelle has no obligation to reimburse authorized payments to scam victims.

Let’s see some more general categories of tricks swindlers choose.

Emails or calls claiming to be from Zelle support staff

Zelle scams could involve text or email messages pretending to originate from Zelle representatives. It could claim issues with payments, account security, unauthorized access, etc. Scammers exploit many venues and techniques that could involve SIM swapping. It means that the caller might mimic the official Zelle phone numbers.

However, Zelle scams do not always impersonate Zelle staff. One scam involved swindlers pretending to be from an electric power company. To restore electricity, the scammers demanded payments via Zelle.

Lottery or get-rich fraud

Users might encounter many Zelle scams about winning lotteries. Quick get-rich scams are also prevalent. In both cases, scamming will likely require initial payments for processing and transferring funds. Such online propositions are fake; asking for initial costs should indicate that.

Romance deception

According to our research, romance scams tricked people into losing $350 million in 2021. Usually, swindlers meet their victims via online dating services and work to gain their trust.

After that, scammers can make various claims, from life-threatening situations to simple financial favors. The Zelle scams mean that these people ask for payments via P2P systems.

Zelle scams on Facebook Marketplace

Facebook Marketplace can help you sell an old coach fast or get excellent deals for other household items. However, scammers can post ads for nonexistent items, likely those that trigger immediate interest.

Zelle scams begin when sellers require payments through this system. Since there are few buyer protections on Zelle, avoid using it for purchasing items via Facebook Marketplace.

Also, if sellers do not budge using Zelle or other P2P payment apps, take it as a red flag.

Zelle business account trick

Zelle business account scams target sellers that post ads for valuable goods online. The trick works as follows:

  1. Fake buyers contact sellers and ask whether they can pay for the chosen item through Zelle.
  2. If the seller agrees, the buyer asks for the necessary financial information, including an email address.
  3. Then, a Zelle email scam arrives at the sellers’ inboxes. The message claims to originate from Zelle support staff. It indicates that the buyer initiated a payment from a Zelle business account. The seller must upgrade to the Zelle business plan to receive the funds.
  4. The business upgrade might cost a few hundred dollars.
  5. The buyer contacts the seller and claims they can send enough to cover the item price and plan upgrade.
  6. The seller might send the funds to upgrade the business plan if convinced.
  7. People behind such Zelle scams disappear, and the money transfer never reaches the seller.

Security tips for using P2P payment apps

Zelle scams and fraud on P2P payment systems are more common than users expect. To conduct your financial transactions safely, follow these guidelines:

  • Transfer money through P2P payment apps only to people you trust.
  • Do not use Zelle for buying goods for Facebook Marketplace or similar platforms.
  • Double-check emails or phone calls that claim to be from Zelle. Preferably, contact them yourself via official sites and numbers.
  • If an email or phone call requires login information or security codes, it is a scam.
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Anton P.

Anton P.

Former chef and the head of Atlas VPN blog team. He's an experienced cybersecurity expert with a background of technical content writing.

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