Recently, thousands of Americans became victims of fraud through the Zelle app, which connected to most of the major financial institutions in the country, such as Citibank, Chase, and Wells Fargo. Zelle is a digital fund transfer app that ostensibly provides an easy way to send money to friends and family or complete private transactions through a convenient app, and the Zelle platform is owned by some of the largest banks in the country. Unfortunately, a scam network took advantage of a security vulnerability in the Zelle platform, bilking many users for large sums of money they were unable to recover.
Many of the bank customers who used Zelle and lost money through fraudulent transactions were unable to recover their losses through their financial institutions. This widespread scam has now generated thousands of civil and class action lawsuits against Zelle itself, as well as the affected financial institutions that refused to reimburse victims of the fraud. The issue has launched a Senate report, in which the investigators concluded that fraud is still prevalent and, in fact, growing across the platform’s userbase.
If you have been affected by fraud via Zelle or any other type of bank app fraud, the Law Office of Quintin G. Shammam can provide the legal counsel you should have to recover your losses. Attorney Quintin Shammam and his team have years of legal experience in consumer protection law. We will help you determine the best method of recovering the funds you lost through a Zelle scam or other form of bank fraud. Depending on the details of your situation, you could have grounds to file additional legal action against whatever party is found to bear fault for the incident.
Your Rights as a Bank Customer in San Diego
When resolving losses incurred from bank fraud or a scam involving a banking app, it is very important to differentiate between “fraud” and a “scam.” When it comes to the former, the Electronic Fund Transfer Act (EFTA) exists to protect Americans who become victims of fraud through electronic payment processors, banking apps, and other electronic platforms. For example, if someone accesses your bank account without your permission and engages in any unauthorized activity by effectively assuming your identity, this would be a fraud.
A “scam” typically involves a bad actor tricking the victim into completing a transaction through their banking app. When it comes to fraud, the victim may have grounds to file an EFTA claim against the perpetrator. They may also have grounds for legal recourse against the financial institution in question if the fraud occurred because of a breach of fiduciary duty or failure of their data security structure. However, when it comes to a scam, the victim is typically required to approve the transaction in question. If you were tricked into losing money through a Zelle or similar banking scam, you do not have the right to file an EFTA claim since you essentially authorized the transaction, albeit on false pretenses.
A gray area exists when the scammer poses as a Zelle employee, which is a common thread among the recently reported series of Zelle scams throughout the country. This scam involves bad actors posing as Zelle employees to obtain Zelle users’ account information. In this situation, the victim would have grounds to file an EFTA claim since the transaction was predicated on fraud, and they acted in good faith, believing they were speaking with a representative of the app platform. Ultimately, the EFTA does not exactly distinguish between fraud and scams but rather authorized or unauthorized transactions. If a transaction is authorized on a fraudulent basis, however, this creates grounds for legal recourse for the victim.
How Your San Diego Consumer Protection Attorney Can Help
When you choose the Law Office of Quintin G. Shammam as your legal representation, we will carefully review your financial records and gather all evidence pertinent to the fraud or scam you recently experienced. Every case is unique and will likely involve several complex details. It’s likely that you would have grounds to seek reimbursement if your financial institution approved any transactions that you did not authorize. Similarly, the bank or other financial institution would bear liability for any breach of data that results in economic losses, and you will need legal counsel to navigate these complex issues.
Your case could be multifaceted, and while it may appear at first that you do not have grounds to file an EFTA claim due to your case revolving around a scam, it is vital to have an experienced San Diego consumer protection attorney review the case and examine your financial institution’s handling of the platform where the scam occurred. Banking apps like Zelle have been advertised as offering secure and reliable fund transfer options for users. If they failed to deliver on this promise, or if they allowed your personal data to be compromised in any way, they have failed to uphold the promise of their marketing and likely bear fault for your losses.
If you were deceived into approving a transaction as part of a scam, a seasoned consumer protection attorney could help you determine your most viable options for legal recourse. Your case may launch a criminal investigation into the source of the scam, and the party or parties responsible for running it can face serious charges based on the scope and severity of their actions as well as how much they stole from victims. When a financial institution has breached its legal obligations to a customer under the EFTA, the victim’s attorney can assist them in securing compensation for their losses. Depending on the nature of your claim, you could have grounds to seek more than just the amount stolen from you, including compensatory or punitive damages that reflect your financial institution’s behavior.
FAQs
Q: How Do I Prove Fraud Via Banking or Payment Apps?
A: Fraud occurs whenever another party accesses your banking information and completes transactions without your knowledge or permission. As soon as you notice any records on your banking statements or transaction history that you did not authorize or complete yourself, you should notify your financial institution immediately. An experienced San Diego consumer protection attorney can then help you determine which consumer protection laws may apply to your situation and assist you in exploring your options for legal recourse.
Q: How Do I Prove Fault for a Scam?
A: Scams like the recent Zelle scam are typically conducted in a coordinated fashion with multiple parties involved. This is criminal activity and will launch investigations at the local and state level, and the victims affected may be asked to provide statements to the police and other investigators. When you have been victimized by illegal misconduct, you likely have grounds for a civil suit against the at-fault party, and the outcome of their criminal case could influence your recovery as well.
Q: Will My Bank Repay Me for a Zelle Scam?
A: Unfortunately, compensation for losses from Zelle scams is rare. If you approved a transaction, this is not covered by the EFTA since you authorized it. However, if the facts of the case show that Zelle or your financial institution failed to uphold a fiduciary duty or if they enabled the scam to occur due to a failure of their data security, you should consult a seasoned San Diego consumer protection attorney to determine what options for legal recourse you may have.
Q: Is It Necessary to Hire Legal Counsel for Bank Fraud or Scam?
A: Resolving any issues pertaining to fraudulent activity on your bank accounts or payment apps will be much easier with legal counsel on your side. Your attorney can assist you in filing an EFTA claim or similar consumer protection case against a financial institution that approved fraudulent transactions. They may also help you file a civil suit against an individual who willfully and fraudulently used your personal information for their own gain. If your case involves a scam or other intentional illegal activity, working with a seasoned attorney offers you the best chance of securing fair compensation for your losses and ensuring accountability for the at-fault party.
Q: How Much Does It Cost to Hire a San Diego Consumer Protection Attorney?
A: Every attorney has their own billing policy, and it is essential that you understand a prospective attorney’s billing policy before you sign a contract for them to represent you in any case. When an attorney accepts a client for a civil claim for damages, they may offer a contingency fee billing arrangement. This would mean the attorney takes a percentage of the total amount recovered for the client, and the client is not required to pay any upfront legal fees. Alternatively, some attorneys use hourly billing, and clients pay more depending on how long their attorneys spend working on their cases.
The Law Office of Quintin G. Shammam is a team of dedicated consumer protection lawyers with years of experience helping our clients in the San Diego area recover from all types of banking problems. Whether you are the victim of fraud and/or identity theft or your financial institution’s lax security has allowed a scam to victimize you, we can help. Contact us today and set up a consultation with our team to learn about the professional legal services we offer in San Diego.