Risk alert: Scams target P2P payments

The latest risk alert from CUNA Mutual Group warns credit unions about scams associated with P2P platforms such as Zelle, where fraudsters employ urgency to pay supposed delinquent utility bills to avoid service being discontinued.

There have been numerous reports of scammers calling or texting individuals claiming to be from a utility company and stating they did not receive payment for their utility bill, and state that service will be turned off. However, if they send funds via Zelle to the company immediately, their services will continue, the risk alert states.

Risk mitigation tips for credit unions:

  • Although members victimized in the delinquent utility bill scam may not be entitled to be recredited under Reg E, credit unions must still promptly investigate their disputes.
  • Remind members to only use Zelle to send funds to friends and family members.
  • Encourage members who are victims of P2P fraud to report it to the FBI IC3.gov or call their fraud hotline at 833-FRAUD-11.
  • Use website pop-up warnings such as “do not send money to someone you do not know” or “do not provide your login credentials or one-time passcode to anyone” or “your credit union will never ask for this information” when the credit union provides the one-time passcodes.
  • Provide member education about scams on your website, mailers, social media, email and other ways when communicating with members.

Zelle is one of the most popular P2P platforms used by credit unions, but other P2P applications are not immune to fraud, according to the risk alert.

CUNA Mutual Group’s risk alerts, in addition to additional risk-prevention resources, may be accessed in their Protection Resource Center. Log-in is required.

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