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Cases of P2P Fraud Are Rising

Four out of every ten Americans use peer-to-peer payment apps like Zelle, PayPal, and Venmo as a convenient way to transfer money and now cases of P2P fraud are rising. In 2022, the total P2P fraud losses reached $1.7 billion which was 90% higher than the total losses incurred in 2021. Today, it’s estimated that 8% of all banking customers have been a victim of peer-to-peer payment app fraud. 

The Consumer Protection Bureau found Zelle to be inundated with scammers likely due to the size of payment platform and the big banks that use it and believes Zelle can do a better job policing scams. Two U.S. Senators, Richard Blumenthal and Elizabeth Warren, want the banks to be held accountable and have been involved in investigations into potential violations of federal laws and consumer rules. Banks have been doing little to combat P2P fraud and very few victims have been reimbursed. 

While the government works to create stronger consumer protections against P2P fraud, follow these steps to safely use the payment apps. 

  1. Link a credit card to your account instead of a bank account. 
  2. Use payment protection when available and when making purchases. 
  3. Verify account information when making cash transfers to friends and family.
  4. Enable two-factor authentication to better secure your account.  
  5. Add alerts to your account will keep you aware of all account activity.