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Comment by alistairSH | Hacker News Reader

It’s also a owned by the 5-6 largest consumer banks in the US (BofA, CapOne, etc).

So, they’re complicit in allowing the fraud to continue.

Use Zelle to transfer to the people you know--that's the intended purpose of Zelle. If you are buying a service/product, use credit cards or PayPal.

Or remind the banks that regulation E puts the responsibility of fraud (minus $50) on them.

US banks got scared by money transfer apps, and decided they want to provide a similar service, at no cost to customers, and minimal cost to them. Of course, they can't have it all, and now they try to put some costs they are not allowed to, onto their customers.

What should the banks do to prevent scams?

Allow reversing transactions that are proven to be scams, as they are required by law to do. https://www.investopedia.com/terms/r/regulation-e.asp

They can not disallow doing that (as you wrote, they are required to), but they do make it very hard, because they are unwilling to put up the cost. However, the regulator mandates they should: what needs to be done is make sure they are always taken to task, and that the task is extremely easy to perform.

Ditch the patchwork nature of it, for starters.

See the Zelle "getting started" page at https://www.zellepay.com/get-started - there's no solid set of instructions because there's almost two thousand different implementations of it. Your bank's procedure may be entirely different than mine's; if your bank doesn't support it it's a different procedure alltogether.

As a result, scammers can fairly easily convince someone who's never or infrequently used it that their process (usually with a phished website posing as Zelle) is legit. The "it's a banking technology, but it's also a website and an app, maybe, it depends" thing doesn't help.

Zelle is also built around the idea that each identity will be connected to exactly one bank account, which is very irritating.

It was pretty wild when I logged into one of my other bank accounts and it said I could not use Zelle with that account because I already had Zelle linked to a different bank account. So I had to unlink it from the other account first. Isn't it common for people to have more than one bank account, and wasn't this the case when Zelle was developed, relatively recently? Why did this use case not cross their mind when they developed it?

LOL. That's insane. Is it one Zelle link, period? Or only to one bank (but you could link several accounts from that one back)?

>Is it one Zelle link, period?

I believe a single Zelle identity can only be linked to a single bank account, and a Zelle identity consists of an email address, phone number or both. Typically it's the "both" option, but I think that in theory you could create multiple identities with multiple email addresses, and link each to a separate bank account

> Why did this use case not cross their mind when they developed it?

I don't know the answer, but seeing as Zelle was developed by a consortium of big banks, it's at least possible they simply don't want to support this use case, because making it harder to have multiple accounts benefits incumbents.

You can never really prevent scams, it is what it is. However, they need to keep a paper trail and reverse bad transactions.

If someone impersonates me or steals my debit card, they can do a bad ATM withdrawal and get cash. That can be reversed, but for some reason once Zelle is in the picture everything is written in stone.

Just to be clear, Zelle's irrevocability doesn't legitimize criminal acts or fraud. It just means your bank won't help you untangle the mess.

It's rare that a lawsuit against a fraudster or thief goes anywhere, but depending on the amount lost, it can be worth it to obtain a default judgment, which can typically be collected for 10 years. If you can identify the person or entity that took your money, they might eventually have enough assets for you to collect.

lol, bofa.

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