A reminder to be on the lookout for payment app scams and schemes
Fewer people are carrying cash. Many have found alternative ways to pay or receive money. Mobile and online transactions are paving the way for preferred payment methods. Mobile payment apps include Apple Pay, Google Pay, Paypal, Zelle, Venmo and many more. According to Tech.co, mobile payments transaction volume reached $1.7 billion in 2021. The number of users and businesses using these apps won’t slow down anytime soon. Although these apps come in handy and make payments easier, there’s always a risk of being scammed.
One scam that occurs on these apps involve fraudulent payment methods. With this scheme, scammers will connect a stolen credit card to a payment app. They then look for people selling big-ticket items (such as a computer, tablet or car) online. The scammers will offer to pay for the product using the app. Once the seller accepts the payment and sends the item, they’ll soon discover that the payment sent is not to a legitimate buyer, and the money is removed from his or her account. The seller is then without either the item or the money.
Canceled payments are also an issue. Some apps take several days to process a transaction. Scammers take advantage of this by setting up transactions and canceling them before they go through. By the time victims realize the money isn’t coming, the scammers are long gone. In addition, scammers overpay for items and then ask for the money they overpaid – only they paid with stolen credit cards. Lastly, some scammers send spoofed emails warning that an account is about to be suspended and the account holder must enter his or her password in a spoofed webpage. Generally, these app vendors will never ask you to enter your password unless you’re on the login page.
To help you avoid payment app scams, the Better Business Bureau offers these tips:
Reach out to who you’re paying for verification before transferring money. If you’re unable to contact him or her, check his or her Venmo profile for public transaction history and information.
Keep your transactions private to reduce the risk of being targeted by scammers.
Only use the app for its intended purpose - sending money to people you personally know.
Secure your phone by choosing a strong password.
Check your account settings for additional security measures, such as multi-factor authentication, requiring a PIN or using fingerprint recognition like Touch ID.
Link a credit card to the app, which will help protect you if you don’t get what you paid for. Linking a debit card doesn’t give you added protection.
Understand it takes a few days for some payments to transfer. Confirm the money transfer before sending the sold item.
Read the fine print before committing to a mobile payment app.
If you believe you’re a victim of a payment app scam, report it to BBB Scam Tracker (Bbb.org/ Scamtracker), the Federal Trade Commission (reportfraud.ftc.gov) and/or the mobile app. To learn more about spotting a scam, visit Bbb.org/all/spot-a-scam or call 937-222-5825 or 800-776-5301.