Zelle Scams/Money Mule Accounts

Posted By: Paris Johnston

Zelle Scams/Money Mule Accounts - 08/17/21 03:50 PM

We went live with Zelle about a year ago (in network using OLB), and we have started seeing a lot of cases where new customers or existing customers are utilizing the service to engage in 'money mule' type scams. New accounts being opened, immediately begin receiving Zelle payments from various people, and then funneling the money out (cash out, cryptocurrency, P2P transfers, etc.). Sometimes we will get disputes from the Sending FI stating a scam occurred which tips us off to the activity. Other times when we question our customer they will have various explanations such as "selling/trading bitcoin, selling product, offering a service, etc.".

We use Verafin but have not been able to benefit from any alerts for this activity, and usually don't detect it until we receive a dispute/fraud research case from Early Warning from the Sending Participant. Any insight on how other FI's are detecting this activity, and responding to it would be greatly appreciated. Thanks!