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Monday Messages

Zelle Fraud Scam

We continue to see members being taken by this type of scam.  We want to let you know how these cons operate so that you might better protect yourself.

One of the more common ways cybercriminals cash out access to bank accounts involves draining the victim’s funds via Zelle, a “peer-to-peer” (P2P) payment service used by many financial institutions that allows customers to quickly send cash to friends and family. Naturally, a great deal of phishing schemes that precede these account takeovers begin with a spoofed text message supposedly from the target’s financial institution warning about a suspicious Zelle transfer. What follows is a deep dive into how this increasingly clever Zelle fraud scam typically works, and what victims can do about it.

Scammers blast out fraudulent text messages about suspicious bank transfers as a pretext for immediately calling and scamming anyone who responds via text. Here’s what one of those scam messages looks like:


Anyone who responds “yes,” “no” or at all will very soon receive a phone call from a scammer pretending to be from the financial institution’s fraud department. The caller’s number will be spoofed so that it appears to be coming from the victim’s financial institution.

To “verify the identity” of the customer, the fraudster asks for their online banking username, and then tells the customer to read back a passcode sent via text or email. In reality, the fraudster initiates a transaction — such as the “forgot password” feature on the financial institution’s site — which is what generates the authentication passcode delivered to the member.

The fraudster then uses that same code to complete the password reset process, and then changes the victim’s online banking password. The fraudster then uses Zelle to transfer the victim’s funds to others.

An important aspect of this scam is that the fraudsters never even need to know or phish the victim’s password. By sharing their username and reading back the one-time code sent to them via email, the victim is allowing the fraudster to reset their online banking password.  Credit unions offering other peer-to-peer banking products have also been targeted, but the fraudsters prefer to target Zelle due to the speed of the payments.

It is critical to note that your Zelle account is a safe and effective tool for transferring funds.  But do not respond unless YOU initiated the call. In the meantime, remember the mantra: Hang up, Look Up, and Call Back. If you receive a call from someone warning about fraud, hang up. If you believe the call might be legitimate, look up the number of the organization supposedly calling you, and call them back.  If in doubt, you’re always welcome to call WyHy at 800-442-2392.

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