It’s hard to imagine, but just a few decades ago people had to physically go to the bank — during their (proverbially short) operating hours — to take out money. The widespread adoption of ATMs in the 1980s put an end to that forever, and in the intervening decades, the idea of having 24/7 access to our money has taken firm root.
The purest expression of that attitude might be found in peer-to-peer (P2P) payment apps such as Venmo, Zelle and the aptly named Cash App. These apps provide a genuinely convenient way to transfer money between friends, family and other personal contacts. Unfortunately, wherever money is spent or exchanged, you’re sure to find scammers looking to divert some into their own pockets. Here are seven of the most widespread Cash App scams, and what you need to know about avoiding them.
Before We Begin: How P2P Payment Apps Work
There are differences between the three main P2P payment apps. Venmo is backed by Paypal, and has no direct connection to the conventional banking system. Zelle is the exact opposite, and is tightly integrated with the banks and credit unions that make up its underlying network. You can access the system through the Zelle app, or a Zelle member institution’s own banking app. Cash App takes yet a different approach, offering what essentially amounts to a “lite” version of personal banking, with P2P payments taking a central role among its services.
Despite those differences, all three apps offer similar basic functionality. The app (or properly speaking, your account within the app) holds a certain amount of money, which you can send to other users as needed. They, in turn, can send you money as well. It’s the 21st-century equivalent of walking around with a wad of “folding money” in your pocket, though in this instance the walking around part is often online and metaphorical.
Linking the app to one of your existing bank accounts or credit cards enables you to add money to your account or withdraw money from the payment app to use somewhere else. The core detail here is that all three center around exchanging money with “peers”: friends, family and other people you know.
1. The “Support” or “Customer Service” Cash App Scams
Let’s say you’re having a problem with your app, so you Google the tech support number and call in. The service rep is cheery and helpful, and just needs you to download a screen-sharing app to your device so he can fix your problem. Or if it’s about shifting money in or out of your account, perhaps he’ll need your PIN and debit or credit card number.
The problem, of course, is that the support rep is a scammer, and that phone number was bogus. The screen-sharing program gives the scammer full access to your device and allows your credentials to be stolen, while handing over your PIN and card number allows him to clean you out directly (as one North Carolina man learned to his considerable cost).
This scam primarily affects Cash App users, since Venmo and Zelle both have direct, customer-facing telephone support while Cash App does not. That being said, if you search the number rather than looking it up directly on the site or in the app, you might still be victimized.
2. The “Friend with an Emergency” Scam
Have you ever had the experience of receiving an odd social media message from a friend or family member, only to find out shortly afterward that their account had been hacked? This is the payment app equivalent of that scenario. The scammer pretends to be someone you know — a friend, a family member, a friend of a friend — who’s in an emergency situation and asks you to help with a few bucks.
Some of these scammers are sophisticated enough to “spoof” your contact’s real phone number, but most just depend on your natural willingness to help out (and perhaps, inattention to detail).
3. The “Accept a Deposit” Scam
Suppose you’re selling something on Craigslist, or a similar site. Ordinarily you’d meet up and be paid in cash, but your potential buyer apparently lives out of the area. So you agree to accept a deposit through your payment app as “earnest money,” and it clears without problems. Reassured, you accept another payment for the balance and ship your item.
Unfortunately it turns out that the payment was loaded into your P2P app from a stolen credit card or other fraudulent source, and it gets clawed back. You’re out the money, and your item.
4. The “Pay a Deposit” Scam
This one works the opposite way, where you’re asked to pay a deposit, or pay in advance, for something you’re going to receive in the future (“real soon, now!”). This might be anything from a used car to the hot new gaming console to that really adorable puppy you saw a picture of, but — again — none of this is real.
Your P2P payment is very much the same as cash. Paying in advance for something you don’t have your hands on, and may never have actually seen in person, is like giving your money to a random stranger on the basis of a handshake and a promise. It might be legitimate, but most of the time it’s not.
5. Charity Scams
Whenever there’s a disaster, a tragedy, a human need in general or even a pet in need of medical attention, you’ll find fundraising taking place. Sadly, wherever you find fundraising taking place, you’ll also find fundraising scams taking place.
Shady operators set up fake social media accounts or websites, and then solicit donations on behalf of real or fictitious causes and organizations. If they’re good at what they do, they’ll have paid enough attention to your online interests to know which plea will tug at your heartstrings. At the end of the day, your money is gone and you’ve helped no one but the scammer.
6. The “You’re a Winner!” Cash App Scams
There are lots of scams that tell you you’ve won some sort of sweepstakes or contest, but this one is specific to Cash App. Cash App is that rare legitimate business that does, in fact, give away free money every week through its Super Cash App Friday promotions on Instagram and Twitter. To enter, users must download their app and set up a Cash App account, follow Cash App on Instagram or Twitter, and then enter by leaving a comment on the contest’s Instagram page or by retweeting the contest’s Twitter post with their own “CashTag.”
This all takes place in plain sight, which makes it a happy hunting ground for scammers. Some brazenly drop their own copycat offers right into the comments on the legitimate posts, seeking victims. Others just drop a #cashappfriday hashtag onto their own bogus social media post, knowing it will appear to anyone searching the hashtag. A similar-sounding offer, from an account with a similar-sounding name, stands a good chance of coaxing victims into responding.
From there, the scam goes in one of two directions. The first is the standard “gotcha” with sweepstakes scams in general: You need to pay a (modest) fee to claim your (much larger) prize. The fee is real, the prize is not. The second is a “money-flipping” scam, which you might also encounter as a standalone gimmick. The fraudster claims to be able to manipulate the Cash App platform, and “flip” your initial payment into a much larger amount in exchange for a cut of the profits. Again, your payment is real but the payout is not.
7. The “Just Venmo Me” Scam
This last one isn’t a specific scam as such, more an adaptation of existing scams that’s designed to ride the popularity of P2P payment apps. The scam itself might follow any number of well-established patterns: a demand for payment from the IRS or the Social Security Administration; an investment opportunity; a home-improvement or home-maintenance package; or perhaps you’re told that your devices are compromised and need scanning and cleaning.
The common denominator here is that they’ll ask you to pay by Venmo, Zelle or Cash App, rather than by more conventional methods, such as check, Paypal or credit card. There is no legitimate reason for a government agency or an above board business to request P2P payment. The real reason is that it’s like cash: Payment is instant, and when it’s gone it’s gone. You typically won’t have the option of canceling or challenging the payment, as you would with a credit card, check or Paypal payment.
It’s Hard to Get Your Money Back
The reason these payment apps are so popular with criminals is that once you’ve sent it, it’s very hard to get your money back. Part of that difficulty is spelled out on Zelle’s website, where it differentiates between the closely related concepts of fraud and scam. It’s fraud if you had no involvement in the process: if hackers use a password they’ve bought on the Dark Web to access your account and drain it, for example. Because you did not authorize that payment, you’ll probably (eventually) be reimbursed.
In a scam situation, however, you’ve voluntarily made the payment yourself. Yes, you’ve been tricked or manipulated into doing so, but at the end of the day, you’re the one who authorized the payment. In this case, the fault lies with you as the user, and the payment company won’t usually take action to get you your money back.
This may sound cold, or even infuriating, if you’re the one who’s been scammed, but the companies have a legitimate point. “Buyer beware” is a long-standing principle in commerce, and it’s not their job to insulate you from the consequences of your own errors of judgment.
Guarding against P2P App Scams
That lack of a safety net makes it crucially important to recognize, and guard against, P2P app scams. There are several things you can do, beginning with educating yourself about the apps and their services. If you know that Cash App doesn’t offer telephone support, for example, you won’t fall victim to the “support” scam. If you know that they have only two official Twitter handles, both with the blue “Verified” checkmark, you won’t blithely click on a message from a lookalike account.
Exercising a healthy degree of skepticism is another important protective measure. If something seems too good to be true — Cash App Fridays notwithstanding — it usually is. If someone asks for money out of the blue, reach out to them through another channel (or better yet, have them request money through the app) to verify that it’s really your contact. If in doubt, use Spokeo’s people search tools to check that the phone number matches the name you’ve been given.
Additional Steps to Protect Yourself
There are some additional things you can, and should, do to protect yourself. One is to link your P2P app to a credit card, rather than a bank account or debit card. Credit cards have a pretty robust set of consumer protections baked in (and priced in) to their business model, so you may be able to challenge and reverse the payment, even if you fall on the wrong side of the “scam vs. fraud” distinction.
Second, take advantage of the security features on the apps and your devices themselves. You can set up the apps to require a second authorization, for example. Usually that’s a texted-out code, but using your device’s biometric features — the fingerprint reader or facial recognition — is better. It’s pretty challenging to fake someone’s face or fingerprint. Using biometrics to lock your phone is smart, as well, though not directly scam-related.
Most importantly, remember that the whole point of P2P apps is exchanging money with people you know. If you don’t know someone — really know them, in person, not just online or on social media — you probably shouldn’t send them money through the app. That one precaution alone will reduce the likelihood of being scammed to just about nil.
I’ve Been Scammed. What Now?
If you’ve already fallen victim to one of these scams, there are some steps you should take. First, gather up every scrap of information you can find that relates to the scam. Screenshots, the bogus social media profiles and support numbers, the actual details of the scam itself…all of those things can be useful in helping identify the scammers or at least in making it harder for them to do what they do.
The next stage is reporting your loss. Your payment app will want the information, because they have a vested interest in minimizing the damage scammers bring to their brand. You should also report the details to the FTC’s fraud report page and the FBI’s Internet Crime Complaint Center (IC3). Warning others by putting the word out— on the BBB’s Scam Tracker page, your own social media platforms or even local news — is less urgent, but might help others avoid the same trap.
If your payment app is linked to your credit card, contacting your provider is another high-priority step you should take. You can attempt to challenge or reverse the payment, using all of the information you’ve collected to demonstrate that you were scammed. You won’t always get your money back, but it is always worth trying.
So…Should I Still Use the App?
P2P payment apps have become popular because they’re fast, convenient and easy to use. Scammers leverage them for the exact same reasons, but that doesn’t invalidate their advantages and it doesn’t mean you should give up on them.
Yes, it’s true that scammers will always lie in wait for the unwary payment app user. The answer, glib though it may sound, is to not be unwary. If you’re educated about the potential scams you’ll run into, and follow the safety precautions we’ve discussed here, there’s no reason you can’t continue to enjoy your favorite payment app’s power and flexibility.
- Smithsonian Magazine: The ATM is Dead. Long Live the ATM!
- Venmo: Home
- Zelle: Send and Receive Money with Zelle
- Cash App: Home
- ABC7 Chicago: Cash App Fake Contact Number Scam Steals Thousands of Dollars From Users
- ABC11 Raleigh: Raleigh Man Loses $24K in Cash App Scam
- Cash App: Super Cash App Friday Official Rules
- Tenable: Cash App Scams: Legitimate Giveaways Provide Boost to Opportunistic Scammers
- Zelle: Understanding Fraud and Scams
- Zelle: Resources & Tips for Safe Payments
- Venmo: How to Avoid Scams on Venmo
- Cash App: Avoid Scams and Keep Your Money Safe with Cash App
- US Federal Communications Commission: As More Consumers Adopt Payment Apps, Scammers Follow
- US Federal Trade Commission: Mobile Payment Apps: How to Avoid a Scam When You Use One
- US Federal Trade Commission: Report to Help Fight Fraud!
- US Federal Bureau of Investigation: Internet Crime Complaint Center (IC3)