How To Avoid 10 Common Zelle Scams and Send Money Stress-free

Whether sending money to a roommate, splitting the tab with your dinner date, or purchasing something from an online marketplace, digital payment solutions like Zelle make transferring money easier. These simple payment platforms also make it easy for scammers to find ways to steal money from unsuspecting users.

People conduct scams through payment services like Zelle because there’s no purchase protection. If you send money to someone posing as your family member or to a seller who doesn’t fulfill your purchase, there’s nothing Zelle can do to help you recoup the funds.

So how do they do it? Scammers often play into a victim’s emotions by instilling trust and creating a sense of urgency. They may use scare tactics to lure you into paying them by saying a loved one is in danger or attempting to blackmail you about your online activity.

Fraudsters also use sites like Facebook Marketplace to steal money from unsuspecting sellers or buyers using Zelle. It’s likely a scam if someone pushes you to send money quickly or gets annoyed with how long the transaction takes.

Let’s look at some common Zelle scams and how to avoid them, as well as how to use identity theft protection services to protect yourself against online scams.

Is Zelle safe to use?

Zelle is a safe way to transfer money between bank accounts; however, Zelle's security depends on the user taking appropriate steps to avoid scammers. Since Zelle does not offer purchase protection, you should treat sending money over Zelle like you would treat cash.

Your Zelle account is linked to either your email address or phone number. Someone with this information can easily request money from you via Zelle. One of the benefits of Zelle is that you can easily send or receive money quickly. But this speed is also one of Zelle's downsides. Once you initiate a transfer or approve a request, the money is moved out of your account, and it’s difficult, if not impossible, to reverse the transaction.

Since Zelle’s transactions are in real-time, you should only send money to someone you trust. If you are concerned that a money request could be a scam, do not send funds through Zelle or other online payment platforms.

Zelle users should stay vigilant and on the lookout for common scam red flags.

10 most common Zelle scams

Scammers are always looking for new ways to steal from you, whether you're using Zelle or another online payment platform. There are several different ways that bad actors gain access to your information or to your money.

Zelle uses your phone number or email address to allow you to instantly send money from one bank account to another. While convenient, this also makes it easy for people to request money from you with minimal information.

Before initiating a transfer through Zelle, always make sure you’re sending funds or approving a transfer for a transaction you’re expecting. Always verify that you’re sending the money to the right place. A quick text message to the requestor to verify they sent the request is a simple way to avoid scams. Identity theft protection can also help you avoid additional loss if your Zelle account has been compromised.

Learn more about the 10 most common Zelle scams and how you can avoid them:

1. Zelle scammers on online marketplaces

Buying and selling items on online marketplaces like Facebook seems convenient, but those marketplaces are also crawling with scammers. With marketplace scams, a prospective buyer may ask for the victim’s phone number or email address to send payment.

After getting your Zelle information, the scammer may send you a fake email, which is part of a phishing scam. The email may ask you to confirm your account information or provide key information that will give the scammers access to your Zelle account.

Marketplace scammers may also pose as sellers of a popular item. The scammer will request that potential buyers provide a deposit or full payment to hold the product. The scammer focuses on the sense of urgency, promising the item to the person who pays a deposit before pick up. All the while, the scammer could be getting deposits for the same item from several victims. Learn more about Facebook Marketplace scams.

2. Zelle overpayment scams

Another popular scam involves fraudsters overpaying for an item and asking the seller to refund the excess money. While the excess funds may seem minimal, the scammer may have used a fraudulent credit card or counterfeit check to pay you. The scammer knows the card will decline or the check will bounce, but they were able to get the overage refunded to them in cash before the victim knows that the payment didn’t go through.

3. Craigslist scams

Similar to Facebook Marketplace, scammers are often looking on Craigslist for opportunities to trick new victims. These scams could relate to purchasing an inexpensive item, or they could be for a larger purchase, like a home rental or vehicle purchase.

When purchasing a vehicle or renting a house, scammers may ask for a deposit to secure the property. They may create a narrative about the lease or title of the vehicle, looking to have you make a down payment or deposit while they sort things out. After receiving payment, the scammer may disappear entirely.

4. Bank impersonator scams

Impersonating a bank or other financial institution employee is an easy way for scammers to gain access to your bank account or to get the personal information necessary to access your funds. Bank impersonators usually start with a smishing text message, asking you to verify a transaction or alert you to an issue with your account. The text message may require that you click on a link or respond to the text. After responding, you’ll receive a call from a scammer impersonating a bank official.

The impersonator may ask you for specific information to gain access to your account. The impersonator may also ask you to transfer funds into another account to keep your money safe.

5. Zelle transfers “to yourself” scams

Scammers will often try to impersonate a banking representative and convince you to transfer money from a compromised account to a new “secure” account. The scam often starts with a text message that seems to be from the victim's bank. The text message will alert the victim to potential fraud and ask the victim if they authorized a transaction via Zelle.

Once the victim responds “no” about the alleged fraud, the scammers call the victim pretending to be a representative from the bank. The fraudster then asks the victim to transfer money from their compromised account to a new, safer account. However, in reality, the new account does not exist for the victim, and instead, the money is transferred into the account of the scammers.

6. Account upgrade scams

Account upgrade scams also involve the victim falling for a phishing scam that solicits the victim for money to upgrade their account for various reasons. In many cases, the victim receives a phishing email purporting that the victim must pay a hefty fee in order to upgrade their account to complete a transaction.

In this scam, the phishing email may ask for the user to input credit card information to complete the upgrade. The scam could also ask for the victim to send the upgrade payment via gift cards or some other form of payment.

7. Zelle account takeovers

While many scams involve the victim losing an amount of money, account takeover scams jeopardize the victim’s Zelle account. In this scam, the scammers use phishing, smishing, or spoofing tactics to gain access to your Zelle account.

From this point, the scammer changes the login information of the Zelle account so that the victim no longer has access to their account. In this case, the scammer now has unlimited access to whatever bank account is associated with the Zelle account. The scammer could transfer a significant amount of money out of the account before the victim notices the funds gone.

8. Bogus employment expense scams

This faux job offer scam involves the scammer requesting the victim's bank account information to deposit funds related to a new employment expense. This scam often begins with a job posting and interview process, which eventually leads to a bogus job offer. The scammer may then ask for your bank account information or ask the victim to front money for necessary work equipment.

This "money mule" scam allows bad actors to easily move money out of your account and into their account without raising suspicion. To avoid this scam, don’t send money to anyone you don’t trust. You can verify employment by asking a potential employer for its business license or other information to validate its legitimacy.

Potential employers will not ask you to front money for equipment. Before providing bank account information to an employer, you can ask about a secure way to input that information directly into the company’s payroll system.

9. Friends and family scams

In this situation, scammers will impersonate your friends or family and request funds from your Zelle account. The scammer may have created a fake account to look like one of your friends, or they may have gained access to your friend's account through another scam. In this instance, you receive a request to transfer money from an account that looks trustworthy, and before thinking twice about it, you send the money. It may be a few minutes or days before you know that you actually sent the money to a scammer instead of your friends or family. This is why it’s important to drop your friend or family member a line in advance to confirm the request.

10. Refund and recovery scams

Refund and recovery scams happen after you’ve initially been scammed, and the bad actors know that you’re going to be eager to recoup your losses. In this scam, you may receive a call from someone claiming to be a bank representative who presents you with a fake offer to help you get your money back. The caller will walk you through a refund process with the promise of recovering your money. The scammer will ask that you pay a fee for the recovery process, or they may convince you to move the remaining money into a different account.

How to spot a Zelle scam

When using services like Zelle or purchasing items online, look out for these common red flags:

• In-app payment requests from unknown people
• Unexpected or unusual in-app cash requests from a known contact
• Suspicious text messages or emails claiming to be from a financial institution
• Transactions with a seller who creates an unnecessary sense of urgency
• Online marketplace transactions that require upfront payment or a deposit
• Overpayment on items being sold on online marketplaces

10 tips to avoid Zelle scams

It’s important for consumers to be vigilant when using online payment solutions like Zelle. Here are a few tips to avoid Zelle scams:

1. Only send money to known contacts.
2. Reach out to known contacts to confirm the request before sending money.
3. Verify emails from financial institutions before replying or clicking on links.
4. Do not respond to email requests for personally identifiable information.
5. Update your Zelle security settings.
6. Send a test transaction first.
7. Sign up for bank or credit union alerts.
   
8. Report anything suspicious to Zelle.
9. Never share passwords or PIN information with Zelle or bank employees.
10. Invest in identity theft protection services.
    

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What to do if you’re scammed on Zelle

In the unfortunate event that you are scammed, you should contact Zelle, your financial institution, and the FBI immediately.

• Zelle scams: Use this contact form.
• Zelle account loss or theft: Call 1-844-428-8542.
• Federal Bureau of Investigation (FBI): File a complaint at the Internet Crime Complaint Center (IC3).
• Federal Trade Commission (FTC): Call 1-877-FTC-HELP or visit ReportFraud.ftc.gov.

If your Zelle account is compromised, other accounts with your personal information may have also been compromised. If you use an identity theft protection service, you should log in to see if there have been any other breaches. If you do not have identity theft protection, manually change login information for any other accounts that may use the same password.

In June 2023, financial institutions that used Zelle began reversing transactions that were part of an imposter scam, such as someone impersonating a bank or government official. Zelle also introduced new features to flag transactions or accounts on Zelle that may be part of a scam.

Zelle Scams FAQs

Bottom line

Online payment apps like Zelle, Cash App, Venmo, and PayPal make transferring money between accounts easier. However, you should still remain vigilant to ensure the protection of your money and take steps to prevent identity theft online. Scammers are always looking for new ways to lure people in, so consumers should be cautious and stay in the know about popular scams.

In addition, using reputable identity theft protection can help you prevent online fraud and safeguard your accounts through robust phishing, ransomware, and malware detection features. The best identity theft protection services will monitor websites and databases for signs of your personal information and even monitor your credit report for unauthorized activity.

If you are a victim of a Zelle or online scam, you should report the scam to Zelle, your financial institution, and the FBI Cyber Crimes Division.

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Author Details

Andrew Adams

About the Author

Andrew Strom Adams is a freelance writer focused on online privacy and digital security. He writes on various topics to help individuals protect themselves on the internet. Andrew has worked in legal marketing, technology, and startups. He has more than 12 years of experience in marketing and communications. He holds an M.B.A. from Westminster College and a B.A. in journalism from Oklahoma Baptist University. When he’s not writing, he’s playing with his two kids or watching reality TV.