Zelle is a peer-to-peer (P2P) payment service that makes it easy to transfer money to friends and family members nearly instantly. However, because Zelle transfers are often irreversible, Zelle creates opportunities for scammers to take advantage of unsuspecting users.

According to a congressional investigation into Zelle, researchers found that customers at the three largest banks that offer the service — Bank of America, Chase, and Wells Fargo — disputed $166 million worth of fraud related to the app in 2023.

However, only 38% of those funds were reimbursed. Over the three-year period from 2021 to 2023, the three banks rejected scam disputes totaling roughly $560 million.

Read more: What to do if you sent money to the wrong person on Cash App, Zelle, or Venmo

7 common Zelle scams

Whether you're a regular Zelle user or you're thinking about signing up for the service, here are some common scams to watch out for and what you can do to safeguard your money.

1. Account takeover

This type of fraud occurs when a cybercriminal manages to take over your Zelle account or your bank account. Once they're in, they often change the password to lock you out and can transfer money to themselves.

To take over your account, scammers need your login credentials — which they can do through fraudulent emails, texts, or phone calls — often posing as your financial institution and telling you there's a problem with your account.

2. Employment scam

With this type of scam, the fraudster lists a false job posting, often on social media or even legitimate recruiting websites. The listing and compensation are often too good to be true, and the "interview" process is typically conducted entirely via email or messaging platforms.

Upon receiving the “job offer,” victims are asked to send money to cover the cost of training materials, supplies, background checks, and other expenses. Of course, the position isn’t real, and the money goes into the pocket of the scammer.

3. Charity scam

Similar to the employment scam, charity scams begin with a fake request, often in the wake of a natural disaster or humanitarian crisis. Scammers may pose as a legitimate charitable organization or as an individual seeking relief.

Charity scams are often successful because they capitalize on the urgency of a very real situation, as well as the empathy of their victims.

4. Online marketplace scams

If you're selling an item or service on an online marketplace such as Craigslist or Facebook Marketplace, some prospective buyers may offer to pay via Zelle rather than meeting in person.

In some instances, they may send a false confirmation showing they overpaid for the item — or alternatively, a counterfeit cashier's check or money order — and ask you to return the difference. In reality, though, they didn't send anything, and you're out the amount you returned.

In other cases, they may simply provide a fake confirmation of payment and request that you send the item. In this event, you're out the item and the payment.

The opposite can also happen if you're a buyer. In this instance, the seller may request payment via Zelle, but then they disappear once you complete the transaction.

5. Rental scams

Another scam related to online marketplaces is the rental scam. In this case, the listing is a phony lease that's often too good to be true. In some cases, they're even copies of legitimate listings.

The scammer may engage in high-pressure tactics and refuse an in-person meeting or inspection of the property. They may also pressure you to send the security deposit and even the first month's rent quickly to beat out other potential tenants.

Once you send the money, though, the listing and the scammer vanish.

6. Impersonation scams

With this type of scam, the criminal may pose as a romantic interest or even someone you know. Depending on who the scammer is impersonating, the process may look different.

With a romantic scam, for instance, the fraudster may take their time to develop a connection before asking for help with an urgent need. They may even send pictures and share personal details to make it seem real.

If someone is posing as a loved one, they may contact you via text, email, or social media, asking you to help with an urgent and dire financial situation. They often ask you to keep the matter secret to prevent you from learning the truth.

7. Refund scams

In some instances, scammers may reach out to you claiming that you've been defrauded. They may pose as a customer representative for Zelle or your financial institution, and they may even send a bogus confirmation of the so-called scam.

To get a refund for the scam, they may ask you for information that gives them access to your account or creates an inadvertent Zelle transfer to the scammer.

Read more: 7 common banking scams (and how to avoid becoming a victim)

How to avoid Zelle scams

According to Zelle, scams in which you authorize a transfer to the fraudster typically don't qualify for a refund. As a result, it's critical that you take steps to protect your financial information and minimize your exposure to scammers. Here are a handful of safeguards that can help:

• Pay attention to emails and texts: If you receive an email or text posing as a legitimate organization that includes links or an attachment, pay special attention to the sender's address and the URL of included links. Don't click on anything until you've verified that it's real.

• Never give out your personal details: Your bank or credit union will never ask you for login information for your Zelle or bank account. If you receive a phone call or message asking for it, contact your bank using the customer service number listed on its website to confirm the situation.

• Don't accept Zelle requests from strangers: While Zelle can be a convenient way to pay for goods and services online, there's no guarantee that you're dealing with a legitimate buyer or seller. If someone you don't know asks you to send or receive money via Zelle, end the conversation.

• Don't be persuaded by urgency: Whether someone is posing as a landlord, a charitable organization, a person in need, or a loved one, avoid the temptation to give in to their urgency. Take some time to think through the situation and do some additional research to make sure the situation and needs are real.

• Be wary of unknown numbers and online profiles: If you get a request from a loved one or organization through an unknown number or online profile, it should put you on guard immediately. With a loved one, it can be as easy as calling them to confirm the story.

• Look out for other things that are out of place: A legitimate employer is unlikely to conduct an interview over text message or email, and they're certainly not going to ask you to pay for job-related materials. Additionally, if a request for money is riddled with spelling or grammatical errors, it's usually a con.

Read more: Is it safe to store money in apps like Venmo, PayPal, and Cash App?

Up Next

• How long does a bank transfer take?

  ---

• How to transfer Apple Cash to your bank account

  ---

• 5 ways to transfer money from one bank to another

The bottom line

Zelle can be a valuable tool when used properly, but the platform is rife with scammers looking to take advantage of unsuspecting victims. Understanding what those scams look like can make it easier for you to protect yourself and your money.

Regardless of the situation, if there's even a small part of you that feels uncomfortable, listen to your gut, take a step back, and assess the situation before proceeding.