Of Banks and Zelle and Fraud
I’ve written before about the fraud susceptible peer-to-peer money exchange known as Zelle.
Is an Alternative to Zelle Coming Soon?
Yes, but it may be just as susceptible to fraud
The money-sending app is widely available and offered by banks as a means of sending money from one account to another — like Venmo or Cash App, only offered right inside your bank’s app or website.
The problem has been that fraud is prevalent within the app and often, the transactions are not reversible.
Now, Congress is taking a look — and potentially holding banks accountable for the fraud that is commonplace through Zelle.
“. . . trade associations and Hill lobbyists say they expect Democrats on the Senate Banking and House Financial Services committees to focus on how peer-to-peer payment systems have made it easier for scammers to fraudulently induce unsuspecting customers into making irreversible payments.”
“. . . the House Financial Services Committee’s majority staff produced a memo for Wednesday’s hearing that name checks Zelle and cites a New York Times story that alleged “fraud has flourished on the platform.” The Senate Banking Committee’s Democratic staff on Monday released a pair of “snapshots” on PNC and Truist that linked to a similar report.”
Will Zelle face reckoning? Will the banks that facilitate peer-to-peer money exchange by way of Zelle also be held accountable?
Want more consumer finance news? Check out my newsletter!