Zelle Payment Services
Sen. Elizabeth Warren (D-Mass.) decided to investigate just how vulnerable Zelle is. Based on data furnished by four of Zelle’s founding banks, she concluded that Zelle is “rampant with fraud and theft.” Published in October 2022, her report found more than 190,000 cases of Zelle-related scams involving more than $213 million in 2021 and the first half of 2022.
In December 2024, the Consumer Financial Protection Bureau (CFPB) filed a lawsuit against Early Warning Services (EWS), the operator of Zelle, along with three major banks: Bank of America, JPMorgan Chase, and Wells Fargo. The lawsuit alleges that these entities failed to protect consumers from widespread fraud on the Zelle network.
Key allegations in the lawsuit include:
- Customers of the three banks named lost more than $870 million over Zelle's seven-year existence due to fraud.
- The banks and EWS rushed Zelle to market without implementing effective consumer safeguards to compete with apps like Venmo and CashApp.
- Hundreds of thousands of consumers filed fraud complaints but were largely denied assistance.
- The banks failed to properly investigate complaints or provide consumers with legally required reimbursement for fraud and errors.
The CFPB is seeking to stop the alleged unlawful practices, secure redress and penalties, and obtain other relief. CFPB Director Rohit Chopra stated that the banks' failure to implement proper safeguards makes Zelle "a gold mine for fraudsters".
Even Reader’s Digest (October 2024) and AARP (January 2024) have done articles on Zelle. If you do an internet search on ‘Zelle Scams’ you will be amazed at all the red flags that pop up. Makes you wonder why Helen Curtis is endorsing Zelle, doesn’t it? Zelle only transfers funds between registered users too. Treasurer Helen Curtis picked Zelle because they will not be charged a fee. Zelle does this out of the kindness of their heart, right? How do they make a profit by giving their services away for free? They must make it up on volume data.
If you are going to use Zelle, we recommend opening a checking account to use only with Zelle or whatever payment service you are using. Keep the balance low, enough to cover any payments you set up and not much more. Don’t use overdraft protection either. Use the email address you opened just for signing in to the HOA’s website, if you have set that up. You must be very careful, especially when dealing with known nincompoops.
Since the lot fee is a once-a-year payment, you could continue to mail or hand deliver it to Helen Curtis.