Common Zelle Scams & How to Avoid Them

Zelle is one of the most popular money transfer services in the U.S., making it a prime target for scammers. From fake bank calls to stolen phones, here’s how to stay safe.

To put things into perspective, Zelle’s network reached 151 million enrolled users in 2024 and facilitated over $1 trillion in transfers.

This marks the highest amount ever sent through a person-to-person payment service in a single year.

But, like anything involving money, Zelle also attracts the scammers.

The total dollar amount sent on the platform last year increased by 27% from 2023, while transaction volume reached $3.6 billion, a 25% increase.

And yet the Consumer Financial Protection Bureau sued the payment service in 2024 for failing to protect consumers from widespread fraud.

Meanwhile, a congressional investigation into Zelle found that customers at the three largest banks offering the service, Bank of America, Chase, and Wells Fargo, disputed $166 million worth of fraud-related transactions in 2023.

While legislation and regulation try to solve problems, protecting yourself has to be a priority.

So Techopedia discusses common Zelle scams — and how to avoid them.

Table of Contents Table of Contents

1. Key Takeaways
2. How Do Scammers Use Zelle For Fraud?
3. How You Can Avoid Zelle Scams
4. How to Get Your Money Back If You're a Victim of a Zelle Scam
5. The Bottom Line
6. FAQs
7. References

Show Full Guide

Table of Contents

1. Key Takeaways
2. How Do Scammers Use Zelle For Fraud?
3. How You Can Avoid Zelle Scams
Show Full Guide
4. How to Get Your Money Back If You're a Victim of a Zelle Scam
5. The Bottom Line
6. FAQs
7. References

How Do Scammers Use Zelle For Fraud?

Zelle transfers are often irreversible, making them a prime target for scammers. Most reported Zelle scams rely on social engineering, where fraudsters manipulate victims with misleading information and scare tactics to trick them into authorizing money transfers.

One common tactic involves scammers posing as bank representatives. They contact victims through text or phone calls, warning them of suspicious activity on their accounts. To “secure” the funds, they instruct victims to transfer money back to themselves.

In reality, the scammers have linked their own Zelle account to the victim’s phone number, redirecting the funds straight into their hands.

Stolen phones also play a role in Zelle fraud. Many users report that thieves access banking apps and transfer money to their own accounts. One Reddit user shared their experience:

“I had my phone stolen, broken into, and money transferred via Zelle. It happened last Wednesday at a Target. I left my phone unattended at checkout while grabbing a lunch item, and when I returned, it was gone.

“At first, I thought I had left it in my car or at home. When I used Find My to track it, the phone was at a random apartment. I tried marking it as lost, but it kept getting turned off. By the time I erased it, I logged into my bank account and saw that $2,500 had been transferred to two different accounts through Zelle on my Chase app.”

Scammers also take advantage of online marketplaces by advertising high-demand items like concert tickets, electronics, or pets. They insist on payment through Zelle, only to disappear once the money is sent. Because Zelle is designed for transactions between trusted parties, victims have little recourse when scammed.

In some cases, fraudsters build trust through online relationships, whether romantic or financial. They convince victims to send money for bogus investments, emergency expenses, or fake business opportunities. By the time victims realize the deception, they may have already lost thousands of dollars.

How You Can Avoid Zelle Scams

To avoid Zelle scams, always verify the identity of the person you are sending money to and only use Zelle for transactions with people you trust. Be cautious of unexpected calls, texts, or emails claiming to be from your bank, especially if they ask you to transfer money or provide personal information.

If you receive such a request, contact your bank directly using a trusted number. Avoid making payments to strangers on online marketplaces, and be wary of deals that seem too good to be true.

Never send money to someone pressuring you into an urgent transfer, whether for an investment, emergency expense, or online purchase.

Enable multi-factor authentication on your banking apps and use strong passwords to prevent unauthorized access.

If your phone is lost or stolen, report it immediately to your bank and wireless provider to secure your accounts.

How to Get Your Money Back If You’re a Victim of a Zelle Scam

Getting your money back after a Zelle scam can be challenging, but acting quickly improves your chances. Start by reporting the fraud to your bank as soon as possible. Banks often deny claims by arguing that the transaction was authorized, even if you were tricked, so be persistent and clearly explain that you were deceived.

Citing Regulation E, a federal rule that protects consumers from unauthorized transfers, may strengthen your case.

If your bank refuses to help, escalate your complaint to the Consumer Financial Protection Bureau (CFPB), Federal Trade Commission (FTC), and your state attorney general’s office. Some banks offer provisional refunds during investigations, so monitor your account and follow up if the credit is revoked.

In response to growing fraud concerns, Zelle introduced new safety measures on August 30, 2023, including a consumer reimbursement benefit for specific scam types.

By November 14, 2023, Reuters reported that banks using the Zelle payment system had started reimbursing victims of imposter scams — cases in which scammers posed as government agencies, banks, or service providers to trick users into sending money.

The Bottom Line

Zelle offers a fast and convenient way to send money, but its speed and lack of fraud protections make it a prime target for scammers. Most Zelle scams rely on social engineering tactics, tricking victims into authorizing transfers they can’t reverse.

To stay safe, use Zelle only with people you trust, be skeptical of unsolicited messages from banks or sellers, and enable security features on your banking apps. If a deal seems too good to be true, it probably is.

FAQs