Zelle scammers use personal information stolen from breaches and the ‘dark web’ to deceive bank customers


SAN FRANCISCO– In a widespread scam, banking imposters are tricking people into sending them money with Zelle, the popular quick payment app.

The scam has been rampant across the country for over a year.

Now others are coming forward – among the latest is a San Francisco man who says the imposters knew all his banking information, which led him into the trap. He said the shock was more than he could bear.

“I had a panic attack,” said the victim, Eduardo Carrascosa, a resident of San Francisco. “I just couldn’t believe it, I just couldn’t believe it…$3,500 is a lot of money.”

That’s what he lost, in an instant, in June. Carrascosa says it happened while he was busy at work, managing shipping at a time when companies are trying to debottleneck the supply chain.

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“I got a call from ‘Bank of America’,” he said, using quotation marks to pronounce the bank’s name. At the time, he thought it was really his bank.

The irony here: the imposters told him that scammers had changed his Zelle account to send money to each other. In fact, that’s exactly what the impostors themselves did. Thousands of dollars, gone in an instant.

A woman on the phone said someone was transferring $3,500 from her bank account. Did he authorize it?

“No it’s not me, go ahead and cancel it,” Carrascosa replied. “Let me go back to my work.

But the woman said he had to quickly cancel the transaction or he would lose his money.

“So I started getting, you know, red flags,” Carrascosa recalled. “So I googled the number calling me.”

Carrascosa was suspicious, but a Google search showed the caller ID on his phone was a real Bank of America phone number. Then a man came on the phone, supposedly the woman’s supervisor.

Carrascosa said he kept questioning the man, trying to figure out if he was really a banker.

“I thought I was outmaneuvering them,” Carrascosa recalled. “I don’t normally ask customer service reps to answer all these questions, but I was suspicious.”

He said the man answered all the questions correctly. “He knew my debit card number, my checking account number, my cell phone number, my address.”

However, the man responded vaguely when asked how long Carrascosa had been a bank customer. “He said he had been there for 10 years.”

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The man told him that someone had linked Eduardo’s cell phone number to his own Zelle account and was using it to transfer $3,500 from his account. He must have changed the number.

The irony was that this was exactly what the imposters themselves were about to do.

Zelle works by registering a phone number or email to receive money in an instant. Reviewers say this unique factor, plus the speed of transfers and the fact that they cannot be reversed, makes it too easy for scammers to steal money with Zelle.

What these impostors were going to do in Carrascosa.

“I was really suspicious and nervous. But by then I was already trapped,” because they had so much information about him, he said. “I was going to do what they told me, you know.”

The man told Carrascosa to type his own name and cell phone number as the recipient into his own Zelle account, so he could then send the $3,500 back to himself. It felt odd but also oddly safe.

“I should have hung up. I thought about hanging up,” Carrascosa recalled. “But I also thought, well, if I’m the recipient, what’s the worst that can happen?”

So he did. First, he apparently sent himself $2,500. Immediately, his account balance plummeted.

“I got nervous and the guy said don’t worry, it’ll be back in an hour,” he said.

Carrascosa says he felt sick. But “trapped”. He sent another $1,000. Then the trap broke.

“They hung up immediately,” he said.

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Two receipts appeared to show that he had sent himself $2,500, then $1,000. After all, everyone said “You sent $2,500 to Eduardo Carrascosa” and “You sent $1,000 to Eduardo Carrascosa.”

In reality, the money went directly to the scammers, who had entered Eduardo’s name and cellphone number into their own Zelle account, registered in the scammer’s name.

A warning had popped up from Bank of America flagging it as a possible scam, but at the behest of the impostors, he clicked “send anyway”.

His $3,500 was gone. He was shocked.

“I had a panic attack. I was…I couldn’t breathe. It was terrible. Because I knew I had been scammed,” he said.

Carrascosa says $3,500 is a huge chunk of her savings, needed for food and rent in expensive San Francisco.

He called Bank of America and initiated a refund request, but got no promise.

“They were telling me it was 50-50,” he said, indicating the possibility of getting his money back. They got no information about it.

He went online, found reports from our sister station ABC7 News ‘7 On Your Side about the widespread scam and how banks have been inconsistent about how they treat victims.

“An ABC7 News article…it was the most useful thing on the internet,” Carrascosa said. “You shed some light on those cases…it was the only hope I had.”

Zelle is owned by seven major banks, including Bank of America. Hundreds of other banks and credit unions offer Zelle as part of their online banking menu, incorporating it into mobile and online banking apps.

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Many customers say they are surprised to find their banks and Zelle offers no fraud protection. However, federal regulators have issued statements indicating that victims who are tricked into sending money using Zelle may be entitled to refunds from their banks by law – if not from Zelle.

After that, many banks offered refunds to victims of the Zelle scam, but not in all circumstances.

After several weeks, and after ABC7 News contacted Bank of America, Carrascosa got the verdict.

“I was convinced it was going to be denied, wasn’t I?” he said. “And then, to my surprise, to my surprise, my application was approved. The money had been refunded. I was thrilled! I couldn’t believe it!”

Carrascosa was so grateful that he offered to donate part of his refund to help other victims or to charity.

“I just want to help you guys, you didn’t have to do this for me,” he said.

Just to note, imposters can glean your personal information from data breaches and the so-called “dark web”. And they use it to persuade you that they are legit, like they did in the case of Carrascosa.

Banks tell customers that Zelle offers none of the fraud protections you get from credit or debit cards, or an insured bank account.

However, as noted, federal regulators say Regulation E, under the Electronic Funds Transfer Act, protects those who are “fraudulently enticed” to provide electronic access to their bank funds.

Bank of America says it is ramping up warnings to customers to beware of scams – and flagged Carrascosa’s transaction before he approved it anyway. As for refunds, he says only that he considers each case individually and follows federal law.

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