Mobile payment apps offer little protection against user error

TAMPA BAY, Fla. – Cash is just a few clicks away with mobile payment or person-to-person payment apps. That convenience is part of the appeal for consumers like Clearwater consumer Frank Sarivola, who told ABC Action News that the app is “quick and easy and a lot of life is now automated.”

Sarivola said he often used Zelle to send money to his college-aged son for gas and other expenses — but not anymore.

He stopped using the Zelle app in March after his son was involved in a minor accident and needed $1,500 for repairs.

Sarivola, a former law enforcement officer, said that in a rush to get his son the money, he typed in a one-digit phone number.

“I entered the phone number, transposed a number accidentally, and immediately recognized it after hitting the send button,” he said.

This single-digit error prompted the bank to send that $1,500 to a stranger’s account in Fort Myers. Sarivola said he was on the phone with his bank, Chase, within 3 minutes. But he said a customer service agent told him there was nothing he could do.

The unintended recipient in Fort Myers returned the money to his Wells Fargo bank. And for weeks, the money sat in limbo. Leaving Sarivola worried and wondering if he would ever get it back. Senior Analyst Ted Rossman explained that Zelle is owned by a group of large banks. But the app doesn’t have any of the protections you might have against bank-issued debit or credit cards. A problem, Rossman told ABC Action News, that could only be solved through regulations.

“It might be nice if there was some sort of waiting period there. If that person called within 2 minutes, well, they could get their money back,” he said.

After a month of waiting, Sarivola issued a call to action. ABC Action News contacted Chase via email and a spokesperson replied that they were already working on the case and hoped to resolve it very soon.

Sarivola told ABC Action News he got immediate action.

“When you followed Chase within days, the money was credited to my account,” he said. “That was awesome. Thank you so much, I really appreciate all of your help.”

According to a Consumer Reports survey conducted in March, 22% of people who used paid mobile apps had a problem with them. In fraud alone, in 2021 more than 70,000 people filed complaints with the Federal Trade Commission. Losses exceeded $130 million.

The Consumer Financial Protection Bureau offer these tips to improve security and avoid risky errors when using person-to-person payment applications:

  • Consider asking your friend to send you a payment request first
  • Check before hitting send
  • Configure your app to require a passcode, PIN, or fingerprint before making a payment
  • Contact your bank or payment provider if you suspect an error

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