JPMorgan Blocks Zelle Transactions Linked to Social Media Scams

JPMorgan Chase, the largest bank in the US, has initiated measures to block certain transactions on the Zelle payments platform following reports of hundreds of millions of dollars lost to scams. The bank is now displaying pop-ups to Zelle users attempting to send money to individuals who appear to originate from social media platforms. This action comes as a response to the significant number of scams facilitated through Zelle, with over half of these scams being initiated through social media.

Melissa Feldsher, JPMorgan’s head of payments and lending innovation, emphasized the risks associated with using apps like Zelle for sending payments to unfamiliar individuals. She advised that such transactions should be conducted using products that offer purchase protection, such as debit and credit cards provided by Chase. Feldsher highlighted that interactions on social media often involve strangers, leading to money exchanges between people who do not know each other. She cautioned that using products like Zelle for such transactions is akin to using cash to send money to someone you’ve never met or for goods you have never seen.

A recent Senate report from last July revealed that $207 million worth of Zelle payments were disputed as scams by customers at jpmorgan chase, bank of america, and wells fargo. The vast majority of these disputed payments went unreimbursed, underscoring the financial impact of these scams on both customers and financial institutions. This development highlights the growing concern over the security of digital payment platforms and the need for enhanced measures to protect users from fraudulent activities.