Zelle is supposed to be a user-friendly way to send and receive payments electronically directly through your bank.
When services like CashApp and PayPal took off, seven major banks in America (JPMorgan Chase, Wells Fargo, US Bank, PNC, Capital One, Bank of America and Truist) teamed up to roll out Zelle – crated through a jointly owned company called Early Warning Services.
By 2021, Zelle was processing nearly twice the number of payments as Venmo, but its reputation was not rising with its popularity.
Unlike companies like PayPal, Zelle isn’t completely trusted – and for good reason.
Senator Elizabeth Warren (D-MA) launched an investigation into reports of fraud, demanding data from all seven of the banks involved with Zelle.
Only four banks complied with her requests but even that was enough to show “fraud is growing” on Zelle, according to Warren. She explained, “the banks are not refunding the vast majority of defrauded consumers, breaking their promises to their customers and potentially violating federal law.”
According to Warren’s investigation, Zelle repaid customers in less than 10% of fraud cases – the majority of which came as a result of consumers being induced to spend money on scammers.
It’s a multi-million dollar problem growing each year.
Hold Bank’s accountable ALWAYS protect the consumer! It’s good business and it integrity 101!
Wow had no idea Zelle was a separate entity from my bank. I always assumed BofA just gave it a catchy name instead of transfer.
Banks: do your job. Have you no customer service training.