February 24, 2024

Frauds

Another Scandal for Wells Fargo – Zelle Fraud

Wells Fargo Finds Itself In Yet Another Scandal

Transferring money to loved ones or completing a monthly payment via Zelle has several advantages, including the fact that it is instant and doesn’t incur the service charges applicable to many conventional e-transfers.

The easy payment solution was started in 2017 through a partnership deal involving Bank of America (BACXL), JP Morgan Chase (JPM) and Wells Fargo (WFC). In addition to being quicker than a conventional transfer platform, Zelle was marketed as the platform to send money directly across people’s banks instead of through a third-party fintech company such as PayPal (PYPL).

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Other financial institutions eventually joined in, and Zelle’s holding company is now controlled by seven of the biggest U.S. banks, including Truist, Capital One (CPFLP), PNC Bank, and U.S. Bank. However, everything that rises quickly can carry its own set of issues. Zelle is becoming linked with far greater rates of scams and corrupt people.

According to Senator Elizabeth Warren’s report published last month, Wells Fargo was indeed the bank with the highest rate of Zelle fraud, with the percentage of bogus transfers increasing 2.5 times in the last three years.

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