Watch out for fraudsters …
Zelle, the payments platform used by millions of customers, is a popular target of scammers. But banks have been reluctant to make fraud victims whole — despite owning the system.
via NYT:
The scheme that ensnared Mr. Faunce — some bankers call it the “me-to-me” scam — has become so common that it’s a staple of local news reports and police blotters. The consumer bureau has been barraged with complaints. In Pennsylvania, a surge in reports about the scam prompted the police to issue a warning. The precise mechanics vary, but it is typically a psychological con that involves tricking victims into surrendering sensitive information.
In Mr. Faunce’s case, it started with a text message that appeared to come from Wells Fargo’s fraud department, asking him to verify whether he had made a payment through Zelle.
Moments after he texted back “no,” his phone rang. The caller ID flagged the number as Wells Fargo. The man on the line identified himself as a Wells Fargo employee and told Mr. Faunce that a thief was trying to empty his bank account using Zelle. To stop the transactions, the man said, Mr. Faunce would need to send the money back to himself.
Behind the scenes, the thief had linked his account, which was also at Wells Fargo, to Mr. Faunce’s phone number. To use Zelle, customers must link either their email address or their phone number to their Zelle account. Mr. Faunce did not have his Zelle account linked to his phone number. That allowed the scammer to claim Mr. Faunce’s number and attach it to his own Zelle account.
Then the thief instructed Mr. Faunce to send $500 to his phone number, assuring him that it would route the money right back into his own account. Instead, Mr. Faunce ended up sending money to the thief’s Wells Fargo account. The thief was able to sidestep the bank’s two-factor authentication process by asking Mr. Faunce to read out the verification codes that Wells Fargo sent to his phone.
It was only when the caller told him to repeat the procedure and send another $500, this time from his savings account, that Mr. Faunce got suspicious. He didn’t have that much in the second account. A genuine bank representative would have known that.
h/t Miri2019