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Cash App, Zelle and Venmo money transfer apps generate thousands of complaints

Digital Money A Cautionary Tale
Posted at 2:47 PM, Jul 16, 2021
and last updated 2021-07-16 17:47:06-04

TAMPA, Fla. — The pandemic prompted consumers to go digital when it comes to paying for almost anything. From the babysitters to lawn services, even friends who need to borrow a few dollars; it was all done digitally.

But the convenience some of these person-to-person apps offers can come at a cost. The apps can open users’ bank accounts to thieves. And the Consumer Financial Protection Bureau reports a flood of complaints, more than 5,200 between May of 2020 and April of 2021.

Cash App user Veronica White said she lost nearly $2,500 dollars to a con artist. She was expecting a payment through the app but there was a problem. The 67-year-old Googled the number for Cash App support. The woman on the other end of the line asked for White’s driver’s license number and debit card information. Then, her $2,500 disappeared.

“I was shocked and I was very disappointed,” White said.

Thieves post fake Cash App support numbers online. A costly lesson Schihidia Dailey also learned after she'd been scammed.

An impostor cleaned out the 25-year-old's Cash App account after she had issues with a transaction and looked for a support number for the app on Google.

“He was confirming my identity and he was like, are the last digits of your social….which, again, made me think it was Cash App," Dailey said.

The number turned out to be a scammer, not Cash App, and Dailey lost over $1600.

Ted Rossman with Bankrate said there's little recourse after a user gives account information to a scammer.

“These transactions for the most part are instant, irreversible. It's on you to check that you are sending it to the right person,” Rossman said.

The U.S. Public Interest Research Group analyzed complaints about peer-to-peer applications and found the most common issues involved problems with transactions, fraud, and account management.

Tampa resident Minh Tran ran into trouble using Zelle after it appeared a stranger sent him $360 by mistake. Tran said he returned the money to the person because they said it was a mistake. That person then filed a dispute and the bank took another $360 out of Tran’s account.

I-Team Investigator Jackie Callaway asked three popular payment apps what they are doing to protect user accounts. Below are the responses:

  • Venmo: “Before completing a payment, Venmo sends an automatic flag to a sender when we have reason to believe they might be transacting with the wrong user.”
  • Cash App: “If a user is sending a payment to someone for the first time, the cash app prompts users to check the customer profile first.”
  • Zelle: “We have included a final prompt requiring the sender to confirm the mobile number or email address they are using belongs to the intended recipient.”
  • Paypal: PayPal has a guide on their website for users who run into trouble with transactions, click here for more information.

In Tran’s case, Callaway contacted Chase bank on his behalf.

“After you guys got in touch with my bank they contacted me right away,” Tran said. The bank recovered his $360.

Users who run into trouble should go through the payment apps to file a dispute.

Cash App customer service is available daily at 800-969-1940 and it advises, “No one representing Cash App will ever ask for your sign-in code over the phone, on social media, or through any other medium.