As U.S. voters enter the final days before one of the most important elections in the country’s history, the CEO of the company behind payments giant Zelle, which processed $481 million in the first half of the year, says the public is on a ” heightened alert.”
“This is the global theme as we head into early November,” says Fowler, who runs Early Warning Services, the Scottsdale, Arizona-based company behind Zelle. “And you have to assume that not everything you read and are presented with is accurate.”
In 2021 The New York Times published a report about how some older Americans were tricked into making political donations in the last election, and in October of this year, CNN reported that the practice continued into this election, with a survey showing 50 older political donors did so allegedly cheated out of $6 million. The AARP says Retirees who fall victim to scams lose an average of $120,000, costing financial institutions $1 billion annually.
Even as Zelle’s co-owners, JPMorgan, Wells Fargo and others are under investigation over concerns about the way they screen bad actors on the app, Fowler has become an outspoken advocate for increased law enforcement funding and response On a social level, fraud of all kinds has become sorted. “All I can say is heightened alert for those who are being targeted,” he says, “and for members of that population who are keeping an eye on them.”
Fowler declined to share Zelle’s actual numbers on reports of election-related fraud against older users. But in May, as the campaign season heated up, Zelle started a program with the National Council on Aging to educate older adults about how to avoid online scams, and the same month the AARP released a list frequent voter fraud, including fundraising from fake political action committees.
CNN earlier this month published The results of its investigation of 1,000 reports filed with government agencies and consumer advocacy groups found that Republican fundraisers were the subject of 803 FTC complaints and Democrats were the subject of 120 complaints.
In addition to the Consumer Financial Protection Bureau’s investigation into JP Morgan, the agency is also investigating whether other Zelle co-owners, Bank of America And Wells Fargodo enough to prevent Zelle fraud on the platform. Earlier this week, Wells Fargo reported that it is considering litigation against the CFPB, joining JPMorgan, which previously reported on the matter.
Added friction to prevent fraud
Cell, PayPal, stripesSquare and other payment processors are adding additional friction to their apps — steps that slow down the process — to encourage potential victims to think twice about who they’re sending money to. “In the Zelle experience, when you make that political donation, there’s going to be a moment where the app says, ‘I don’t recognize that.’ ‘Are you sure?'” Fowler says. “And there will even be certain places where there will be an additional call or step.”
Amy Nofziger, director of fraud victim assistance for AARP’s Fraud Watch Network, says her team fields 500 calls a day from more than 50 members and others to inform them of various scams. Based on these calls, she says Cash App, Venmo and Zelle are the most commonly used by scammers.
“There is confusion with some of these apps because they are often advertised through your bank,” says Nofziger. “They feel like they have the same consumer protection as your bank, but that’s not the case. We really recommend only using these apps for friends, family and acquaintances.” Making matters worse, some people only realize they’ve been scammed weeks or months later, meaning the numbers could rise after the choice.
Payment processors are increasingly adopting education policies to combat fraudsters, particularly among older victims. Earlier this year, payments giant PayPal became the first P2P payment platform connect AARP’s BankSafe program is designed to teach retired Americans how to spot fraud. stripes And square also offer online fraud detection services.
Over and beyond Education and construction software speed thresholds, the payments platform’s chief fraud risk manager Ben Chance said in August called for an increase in law enforcement funding in a Assets Interview. “Whether it’s a puppy or a love interest or something that’s never delivered or a political scam,” Fowler says. “The energy here must be used for politics, law enforcement and government engagement.”