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New Technologies to Tackle Authorized Payment, Zelle Scams
Bank Info Security
Scammers are duping victims in many ways: tricking customers into believing they need to reverse a Zelle payment, promising big earnings from cryptocurrency investments or convincing online lovers to send money. A myriad of schemes is resulting in a sharp rise in authorized payment scams, which according to Aite-Novarica Group now account for two of the top five categories of fraud volumes and losses for financial institutions.
In the United Kingdom, for example, nearly half of the 609.8-pound million in fraudulent transactions in the first half of 2022 was due to authorized push payment scams. The growth in this type of scam, in which victims transfer the money and are held liable for the losses, has gotten the attention of banking regulators as well as the U.S. Congress, which argues that banks should reimburse their customers as they do in other types of fraudulent transactions.