Sending and receiving money with your phone through mobile payment apps is handy. But be careful! Scammers might try to trick you into sending them money instead. Here's what you need to know about using these apps safely.
How Mobile Payment Apps Work
You are probably familiar with Venmo, PayPal, Cash App, and Zelle. First, you download the app and make an account. Then, you link up your bank account, debit card, or credit card. After that, you can start sending and receiving money. But hold up – the money doesn't go straight to your bank. It stays in the app until you decide what to do with it. So, how can scammers get your money?
How Scammers Trick You
1. Pretending to be Someone You Know
Sometimes, scammers pretend to be a family member or friend in trouble, asking for money urgently to deal with an emergency. For example, they might create a fake payment app profile, using your family member’s name. When they request you to send them money, it could say “’I'm in a bit of a situation and need your help urgently. My car broke down and I’m stranded on the highway. I don’t have my wallet with me. Can you send me $200? I’ll pay you back as soon as I can.”
Protect Yourself
- Contact the person directly using a phone number you already have before sending money.
- Double-check the recipient's name and payment information.
- Only send money to people you know and trust.
2. Claiming You Won a Prize
Scammers might claim you've won a prize but need to pay fees to collect it. When the scammer contacts you, they might say "Congratulations! You've won a special prize in our sweepstakes. But before we can release your winnings, there are some processing fees you need to cover. Just send us a small payment through this mobile payment app, and you'll get your prize right away!"
Protect Yourself
- Legitimate prizes don't require you to pay to claim them.
- Legitimate prizes don't require you to pay to claim them.
- Never send money to receive a prize.
3. Pretending to be Your Bank
One of the fastest-growing scams involves criminals pretending to be your bank. They may call, text or email you claiming there is suspicious activity on your account. In some cases, they can even make the caller ID appear to be your bank's phone number, making the call seem legitimate.
One of the fastest-growing scams involves criminals pretending to be your bank. They may call, text or email you claiming there is suspicious activity on your account. In some cases, they can even make the caller ID appear to be your bank's phone number, making the call seem legitimate.
They may tell you:
- There are fraudulent transactions on your account.
- You need to send money to yourself using a payment app.
- You need to move your money to a "safe" or "secure" account.
- They need a one-time security code to stop the fraud.
- Stay on the phone while you complete the transaction.
These requests are all red flags.
Protect Yourself:
Remember, your bank won't ask you to transfer money or share personal information over the phone.
- Your bank will never ask you to send money to yourself or move your money to another account to prevent fraud.
- Your bank will never ask you to share a one-time verification or security code over the phone.
- If you receive an unexpected call claiming to be from your bank, hang up and call the number on the back of your debit or credit card to verify the request.
- Never use a phone number provided by the caller.
Taking a moment to verify can help prevent scammers from gaining access to your money.
What if You've Been Scammed?
If you believe you've been the victim of a payment app scam:
- Contact your financial institution
- Report the incident to the payment app.
- Change your passwords if your account credentials may have been compromised.
- Report the scam to the FTC at ftc.gov.
If something doesn't feel right, trust your instincts. Contact your bank directly using the number on the back of your debit or credit card or the number listed on its website before taking action. A few extra minutes could save you from becoming the next victim of a scam. The sooner you report suspicious activity, the better your chances of limiting further fraud.
