No one knows exactly how many Americans have lost money in fraudulent charges through the money transfer app Zelle, though millions could be at risk. One thing is clear: neither Zelle, nor its parent company Early Warning Services, nor the banks that host the app have been stepping up to refund the stolen funds.
News reports from all over the country—in Chicago, Atlanta, San Francisco—tell stories of customers swindled out of their money with no way to get it back, except in individual cases brought to specific banks’ attention by reporters. Debbie Shepard-Polak, for example, a landscaping company owner in the Chicago suburbs, recently lost $4,600 in a Zelle scam.
The torrent of complaints from angry customers has spurred two Democratic senators, Elizabeth Warren of Massachusetts and Robert Menendez of New Jersey to write a letter to Early Warning Services telling the company that it and banks need to provide “appropriate redress to defrauded customers.”
Zelle is an app created by EWS, which is owned by seven of America’s biggest banks: Bank of America, BB&T (now Truist), Capital One, JPMorgan Chase, PNC Bank, U.S. Bank and Wells Fargo. Hundreds of banks and credit unions across the U.S. offer Zelle.
The Consumer Financial Protection Bureau considers these fraudulent money transfers to be covered by a federal law, Regulation E, which means that the consumers…
