SEATTLE–With one class action already filed against a credit union, other proposed class actions are being filed against financial institutions related to scams targeting consumers who use the Zelle P2P solution, with the language used in the lawsuits largely similar.
As CUToday.info reported here, a class action lawsuit has been filed against Navy Federal Credit Union that alleges it did not properly inform account-holders that they will not be reimbursed for financial losses due to fraud on Zelle.
Now, a Seattle resident has filed a proposed class action against Wells Fargo Bank that makes similar allegations.
The 21-page lawsuit says that although the type of Zelle scam to which the plaintiff fell victim is well known to the collection of banks, including Wells Fargo, that own Zelle, “no steps have been taken to protect or educate consumers given how much it would cost to enact such measures,” according to ClassAction.org.
In addition to Wells Fargo, the lawsuit names as a defendant Early Warning Services, LLC, the company that operates Zelle and which is owned by a consortium of banks. The lawsuit alleges Wells Fargo failed to warn customers of the risks of using Zelle, which include the potential to fall victim to scams whereby someone tricks a consumer into sending money by impersonating their bank, ClassAction.org stated.
The lawsuit alleges Zelle has become “a favorite among criminals.”
Lack of Warning Alleged
“Nowhere in Zelle’s marketing does Zelle warn potential users of the risks of being scammed by persons impersonating their banks,” the suit states. “Consumers are not aware that transactions with Zelle differ from other similar platforms.”
That language is identical to that used in the complaint against Navy Federal.
The suit claims that although the plaintiff was wrongfully debited $7,500 through a Zelle scam, Wells Fargo has not reversed or refunded the money, despite being obligated to do so, according to ClassAction.org.
“On information and belief, Wells Fargo Bank does not reimburse consumers for losses from [electronic funds transfers] via Zelle due to fraud, even where the losses are timely reported by consumers,” the case states, ClassAction.org said.
Mimicking the Bank
According ClassAction.org’s report, a “scammer reached out to the plaintiff and ‘mimicked’ Wells Fargo’s identity. On December 23, 2021, the plaintiff received a text message that stated that there were unauthorized transactions on his Wells Fargo account and that he should reply ‘yes’ if he wanted to receive a call about it, purportedly from the bank, the case relays. Soon after responding ‘yes,’ the plaintiff received a phone call from a number that was identified on his caller ID as Wells Fargo Bank, and a person on the other end claimed to be a representative from the bank’s fraud department calling to confirm possible suspicious transactions on his account, the suit states.
“Per the case, the purported Wells Fargo rep informed the plaintiff that he needed to use the Wells Fargo app, specifically the Zelle function, to ‘delete and then re-add and pay himself as a Zelle payee.’ By doing so, the scammer told the plaintiff, he would ‘confirm his identity and lock out the scammer from accessing his Wells Fargo account’.”
Hit a Second Time
The lawsuit further states that during the process the plaintiff was sent a verification code via text message that he was fraudulently induced to share with the scammer, purportedly to confirm himself as a payee to his Wells Fargo account, the case relays, ClassAction.org stated.
The complaint alleges the plaintiff was then hit a second time by the same scam.