Scammed out of thousands from your Venmo or Zelle account? Don’t expect an easy refund

There are plenty of peer-to-peer payment services out there, but if you’re like most people in America, you’re probably going to use either Venmo or Zelle. But if you’ve been extorted of your access to your online banking account, tough luck: there’s a very good chance that even if you submit a police report and other evidence with your request for a refund of any unauthorized transactions, your bank will deny you.

The New York Times reports on several cases where scammers and thieves have stolen bank account access through a variety of methods — fake tech support, SIM swap attacks, brute force, etc. — and have made thousands of dollars in transfers using Zelle.


Argelys Oriach had $8,294 sapped out of his Capital One account through Zelle. Even with a police report and grand jury testimony, Oriach only got $250 of it back before the Times got involved and reached out. The bank issued the full amount afterwards and apologized for the hassle.

Under a law from 1978 titled Regulation E, banks are supposed to refund any unauthorized electronic funds transfers at the consumer’s request. The Consumer Financial Protection Bureau issued guidance in 2020 to clarify that peer-to-peer payments through apps like Zelle were covered under Regulation E. It’s the bank’s responsibility to prove that funds transfers were authorized.

Chuck Ruoff lost $3,450 through Zelle to a SIM swap attacker and all Bank of America told him initially that was that the transaction “did not appear to be unauthorized” — the Times’ words, not the bank’s. It took him hours of calls and more than 45 days of waiting before he got a helping hand from the newspaper. Ultimately, Bank of America gave out a full refund.

Zelle is the digital transfer app of choice for many Americans with a transaction volume of $490 billion in 2021, more than double what second-place, PayPal-owned Venmo put through. The app is a product of Early Warning Services, LLC, which is formed from a consortium of seven major financial institutions: Bank of America, Capital One, Chase, PNC Bank, Trust, US Bank, and Wells Fargo. About 1,600 other banks and credit unions are sanctioned Zelle members. Early Warning Services does not disclose instances of fraud, though a spokesperson has stated that the major incidents are “rare.”

There’s renewed pressure coming from the CFPB as well as congressional Democrats against the banks to step up on making its defrauded customers whole as scamming becomes a larger problem.

Carla Lisio saw $4,750 of her money go to someone she didn’t recognize on Zelle. When the Times asked about her case, Chase Bank said it would stand by its decision against refunding her.

If you’re thinking about rerouting all your transfer activities to a competitor, just know that the platform might not have your back there, either.

In March, a Georgia man was conned into having his phone grabbed and had $3,080 stolen through his Venmo account. In a letter to Decaturish, Matthew Groh wrote:

[…] The company insisted I still allowed the fraudulent money to be withdrawn from my bank, showed no interest in recording my police report number, and refused to allow me to speak directly to the fraud department.

He contacted the investigative team at WGCL-TV and did manage to get all his money back. Venmo told the station it was not aware of an upward trend in scams.

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