Person-to-person (P2P) payment service apps like Cash App,Venmo, and Zelle have quickly become popular because they make sending and receiving money easy and quick. But surprise, surprise: where the easy money goes, fraudsters are quick to follow. Online scammers love P2P apps because payments made using Cash App, Venmo, or Zelle are instant and can't be canceled. So once you have authorized a transfer from your account using a P2P service, your chances of getting your money back are almost zero. Today, dozens of sophisticated scams circulating through text messaging and social media, specifically target users of P2P payment platforms. Often they take the form of too-good-to-be-true investment opportunities, fake customer support numbers, or requests to pay for expensive goods from unknown sellers. Others, including romance scams, and fraud between friends and family members, are easier to fall victim to if you have a P2P payment app installed on your phone. Either way, it pays to be aware.
When it comes to online banking scams involving P2P payment apps, Tanya Arbuthnot, formerly Bank of St. Francisville's Electronic Banking Officer and now Vice President of Human Resources, has seen it all. Here, Arbuthnot describes three common P2P fraud scams she sees locally, and offers tips on how to avoid falling for them.
1: The “Friends and Family” Scam #1
A friend or a family member asks to use your phone. Once you’ve unlocked it, they open your P2P app and use it to send money to themselves or someone else they know.
Arbuthnot notes that, once a phone is unlocked, it’s usually possible to open and use a P2P app like Cash App or Venmo without any additional security measures. She recommends logging out of the app after each use (so that FaceID or passcode verification will need to be entered before the app can be launched again), and installing the SecurLock Equip app to protect against unwanted charges. After letting someone else use your phone, she also recommends checking any P2P apps, to make sure no transactions were made.
2: The “Friends and Family” Scam #2
You ask a friend or family member to run to the store to buy groceries and give them your credit or debit card to pay for it. While they have your card, they add it to their own P2P app or digital wallet, then start using it themselves.
To protect against unauthorized credit or debit card use both online or in-person, Arbuthnot recommends installing the SecurLock Equip app, available in the Apple App and Google Play stores. SecurLock enables cardholders to control how, when, and where their credit and debit cards can be used online. Users can switch cards on or off, prevent overseas or out-of-state transactions, and also set the app to send a notification any time a credit or debit card transaction is attempted.
3: The Romance Scam
A scammer romances a victim through a dating or social media site. Then after building trust, requests money via a P2P payment app to finance a visit, or to cover the costs of some sudden emergency.
Arbuthnot explains that romance scammers love P2P apps because anyone can create a payment profile using any name they choose. Doing this makes it easy to request and receive payments from victims without ever revealing their true identity. Arbuthnot recommends never sending money to anyone via a P2P app unless you’re absolutely sure they’re who they say they are.
General rules of thumb for keeping online purchases safe
Whether you’re using P2P payment services or not, Arbuthnot recommends these general rules of thumb for keeping all your electronic banking transactions secure:
1: Only use P2P services to make transactions with family, friends, and people you know personally.
2: Never use P2P services to pay for expensive goods and services online. When buying an item from a business, or someone you don’t know personally, use a credit or debit card. Never buy from an online business that requests payment by a P2P app. They’ll accept a credit card if they’re legitimate.
3: Use strong, unique passwords for all P2P and online banking apps. Don’t use the same password for multiple apps and services.
4: Don’t store money in the app. Doing so makes it easier for your funds to be drained if someone does get hold of your password.
5: Don’t allow websites to store your credit card info. If the business gets hacked your card information will be compromised. It’s safer to type it in each time, even if it’s slightly less convenient.
6: Use common sense. If something sounds too good to be true, it probably is.
Have an online banking security question? Want to know more about keeping your accounts safe online? Contact Tanya Arbuthnot at (225) 784-3239 or by clicking HERE.