Permanent Subcommittee on Investigations to Hold Hearing on Failure of Zelle and Big Banks to Address Deluge of Scams and Fraud
[WASHINGTON, DC] – Tomorrow, Tuesday, May 21, 2024, at 2:30 PM ET in 342 Dirksen Senate Office Building, U.S. Senate Permeant Subcommittee on Investigations (PSI) Chairman Richard Blumenthal (D-CT) will convene a hearing titled, “Fraud Alert!: Shedding Light on Zelle.” The hearing will examine the human toll of scams and fraud on Zelle, the popular peer-to-peer payment (P2P) platform.
“Failing to protect unsuspecting consumers from rampant scams, Zelle and similar apps should be held accountable, along with banks that enable them,” said Blumenthal. “Tomorrow’s hearing will give voice to victims of such schemes, and highlight how peer-to-peer apps and banks can better shield potential victims. Victims’ stories will show how proactive protection—and reimbursement—have been disregarded or denied. The scammers are exploiting increasingly sophisticated technology, which corporate actors can stop, or at least pay the damage from their neglect. The risks are rising. So must the safeguards.”
The prevalence of scams and fraud on P2P platforms has grown along with the popularity of these services. In 2022, payment apps or services were the third most common fraudulent payment method reported to the Federal Trade Commission. In June 2023, PSI opened a bipartisan inquiry into Early Warning Services, the company that operates the Zelle network and the three largest Zelle owner banks—Bank of America, JPMorgan Chase, and Wells Fargo.
Tomorrow’s hearing will scrutinize how common fraud and scam schemes are perpetrated using Zelle, the availability of and processes for consumer reimbursement of money lost to scams and fraud, and the extent of current regulatory and legal protections for consumers using P2P money transfer services. The hearing will include testimony from:
- Stephanie Tatar, Founding Attorney, Tatar Law Firm
- Ariana Duval, Student at North Carolina A&T, Experienced Scam on Zelle
- John Breyault, Vice President of Public Policy, Telecommunications and Fraud, National Consumers League
- Anne Humphreys, Retiree, Experienced Scam on Zelle
- Delicia Hand, Senior Director, Digital Marketplace, Consumer Reports
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