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Michelle Cohen, M.D., 59, a psychologist in Delray Beach, Florida, was looking for an Italian greyhound puppy when she found a broker online who specializes in them: Amore Italian Greyhounds.
Because it looked legit, Cohen chose a puppy from nearly a dozen advertised, signed a bill of sale and sent $900 through Zelle, a peer-to-peer (P2P) money-transfer app that allows users to instantly move funds from their own bank account to someone else’s. Amore Italian Greyhounds agreed to have the dog transported to Cohen’s home — but the puppy never came. Instead, a company called Logistek
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Transportation contacted Cohen seeking $2,300 for shipping. Something seemed fishy. When Cohen refused to send payment, all communication ceased. She realized she was the victim of a puppy scam, a disturbingly common crime.
“It was very convincing,” Cohen says. “I showed the website to my whole family, and nobody questioned it until after I lost the money. That’s when my niece looked it up online and found some comments about them not being real breeders.” Although she contacted both the police and her bank in an effort to get her money back — the latter even opened a fraud investigation — she was told that there was no way to recover her lost funds. “The money’s gone,” she says.
Cohen, who reported the incident to the AARP Fraud Watch Network Helpline, isn’t alone. Because they’re as fast and convenient for criminals as they are for consumers, Zelle and other P2P payment apps — including PayPal, Venmo and Cash App — are favorite tools for modern-day scammers.
Why scammers like P2P apps such as Zelle
Seven of America’s biggest banks established Zelle in 2017 to facilitate instant digital money transfers between individuals. Today, more than 2,000 banks and credit unions offer Zelle to their customers through mobile banking apps.
“Zelle is a powerful and very useful service,” says Steve Grobman, senior vice president and chief technology officer of online security company McAfee. “Say you go out to eat with your sister and you want to split the check. If your sister slaps down a credit card and pays for it, and you want to send her $50, Zelle is great for that.”
The same is true for the other cash-transfer apps.
“Consumers have decided, ‘Hey, we want to be able to send money to whomever we want at the push of a button,’ ” explains Jason Zirkle, a certified fraud examiner (CFE) and training director at the Association of Certified Fraud Examiners (ACFE). “The other side of that is that all of those tools are also vulnerable to scammers.”
P2P apps don’t have the same consumer protections that credit cards have. Transferring money through them is more like paying with cash because transactions are instantaneous and usually irreversible.
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