In the Scam of the day for August 16, 2025 I told you about the lawsuit NY Attorney General Letitia James brought against Zelle, the service created by major banks in 2017 that enables people to quickly and easily send money from their bank accounts to other Zelle platform users.  Unfortunately, as I have often reported to you, Zelle has been a favorite method for scammers to lure their victims into paying them through a variety of scams.  According to Attorney General James, Zelle lacks important verification steps that would help prevent fraud such that scammers can sign up for Zelle using misleading email addresses that make them appear to be legitimate businesses or government agencies.  In the lawsuit, James points out the example of someone posing as a Con Edison employee threatening to turn off electricity unless money was sent by Zelle to the scammer who was able to use the name “Coned Billing” for the account.

If this sounds familiar to you, the Consumer Financial Protection Bureau had filed a similar lawsuit against Zelle in December of 2024, but the Trump administration dismissed the lawsuit earlier this year.

The case is presently still in the pre-trial litigation phase where both sides are filing motions and gathering evidence.  No trial date has been scheduled.

TIPS

Meanwhile if you are a Zelle user what can you do to protect yourself?

Before signing up for any Zelle you should familiarize yourself with their fraud protection rules. In the fine print you may find that you have little, if any, protection if you use the account to purchase something that ends up being a scam. Consumers should recognize that Zelle should not be used for commercial transactions, but only to transfer small amounts of money to people you know.

In order to protect your account from being hacked and being taken over by a scammer who could access your credit card or bank account, you should use a PIN or other dual factor authentication for your Zelle account.

To avoid having your Zelle account and other accounts from being taken over by scammers, never provide your username, password or PIN in response to any email, text message or phone call unless you have absolutely confirmed that the request for this information is legitimate, which it never is. You can confirm this by contacting your bank by calling them at a telephone number you know is accurate. Even if you get a call that appears to come from your bank or other company with which you do business, your Caller ID can be tricked by a technique called spoofing to make the call appear legitimate when it is not.

Finally, remember no governmental agency asks for or accepts payment by Zelle.

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