US banks are taking new steps to stop illicit transactions on Zelle.
JPMorgan Chase, Citibank, Bank of America, Wells Fargo and other US banks are implementing new measures to protect its customers from falling victim to scams when using Zelle to send people money, reports NBC San Diego.
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Chase says it no longer allows its customers to send Zelle payments to contacts made through social media. About half of the scams reported by its customers originate on social media platforms, according to the bank.
Chase customers may be asked questions about their Zelle payments and have their transactions blocked based on their answers.
Says Chase,
“Zelle is designed for sending money to others you know and trust, not for buying things on social media.”
Meanwhile, Citi says its customers are now receiving a series of alerts when they attempt to send money using Zelle, including having to “complete an attestation that describes various fraud and scam scenarios, prompting them to assess and indicate if they might be a victim.”
They also receive a reminder that the transaction is likely irreversible.
Meanwhile, Bank of Americas says customers using Zelle will also receive pop-alerts about potential scams.
“When sending money using Zelle and before completing the transaction, clients receive several pop-up messages alerting them to red-flags that indicate a scam including, as referenced, that we would never ask a client to send money to themselves or anyone and are encouraged to only send money to people they know personally.”
Wells Fargo also informs customers that reversing Zelle transactions is unlikely and to only send money to trusted recipients.
“When using Zelle, Wells Fargo alerts our customers to double-check the recipient and reminds them to ‘only use Zelle to send money to people and businesses you trust.’ We inform customers that Zelle is an immediate form of payment, just like cash. Scammers who receive payments from victims typically withdraw the funds from their financial institution immediately, making recovery difficult.”
The Consumer Financial Protection Bureau alleges that bank customers lost more than $870 million through Zelle scams over a seven-year period.
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