Is Your Holiday Transaction Safe?

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Hi! I don’t want to interrupt your holiday shopping, especially with all those Cash App, PayPal and Zelle transactions you’ve been executing during this festive holiday season; but is your account safe?

Let me tell you, a few months ago, chief executives from the seven largest banks in the country were up on Capitol Hill to testify before the Senate Banking, Housing and Urban Affairs committee. The hearings are part of their annual congressional oversight and what they shared was quite revealing.

Fraud Increases

The hearings revealed that fraud especially on the Zelle platform was both rampant and increasing. For several months, the committee requested Zelle fraud data from the banks, but JP Morgan and Wells Fargo have not provided complete data according to a report and investigation from one of the senate committee members. In case you didn’t know, Zelle is owned by the banks and six out of seven owners were there to testify that day.

How bad is it ? According to U.S. Banks, fraud and scam claims in the year 2020 were 14,886. This year, scams and fraud claims from Zelle are projected to be an estimated 45,000!

Just to illuminate, four out of the seven banks who have reported fraud and scam claims to the committee, project that combined claims and fraud this year will exceed two hundred and fifty-five million dollars. ($255, 000,000.00). You do the math!

Zelle Banking Perspective

If your Zelle payments were unauthorized and you contest those payments, banks are not repaying those transactions. Three of the banks reported that they have only made repayments to 9.6% of their customers’ scams or claims, especially where the customers were induced into making a Zelle payment. The 9.6% of customer claims, equated to $2.9 million dollars and 11% of repayments. But I just told you that Zelle scams and claims are projected to exceed two hundred and fifty-five million dollars for 2022.

Zelle’s position is that they have a zero liability policy when someone gains unauthorized access to your account and executes payments. That policy seems to be in total opposition to both the Electronic Fund Transfer Act (EFTA) and the Consumer Financial Protection Bureau (CFPB) Regulation E, which requires banks to repay customers when funds are illegally taken out from their account.

The following statements have been taken from Zelle website of frequently asked questions:

“You can only cancel a payment if the recipient hasn’t yet enrolled with zelle®. You can go to your activity page within the zelle® experience, either within your mobile banking app or the zelle® app, choose the payment you want to cancel, and then select ‘Cancel This Payment.’ If your recipient has already enrolled with zelle®, the money is sent directly to your recipient’s bank account and cannot be canceled.”

So there you have it! Peer-to-peer payment systems can make life easy and fun during this holiday season. But be on the lookout for the rise in Zelle scams and claims this Christmas.

WHAT’S UP!

Today’s what’s up is about your credit report. Equifax stated that due to coding errors which occurred between March 16 and April 6, this year, some 300,000 consumers received erroneous credit scores. It means that if you applied for an auto loan, mortgage, credit card etc during that time, you may now be paying higher interest rates because of the incorrect credit scores reported. What can you do? Check your credit report. And that’s what’s up!

Ruthven R. Phillip, Esq., is a tax attorney, Stewardship and Philanthropy Ministry Assistant, and CEO of Give2Getrich, LLC . Give2Get Rich, LLC 2022. All Rights Reserved. Any distribution or reproduction of part or all of the contents in any form is prohibited

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