Tips to Protect Yourself When Using P2P Payment Apps Like CashApp and Venmo

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When peer-to-peer (P2P) money transfer services like CashApp, Venmo and Zelle came out, consumers were excited to have easy ways to send money to friends and family.

These apps, and other money transfer apps like them, can be a great resource for simple transfers, but what happens when you use them to make a purchase? If you’re using these apps to purchase from an unknown vendor or person, you have now opened yourself up to potential fraud and the loss of your money.

Scammers are out there using every technique to access your money and your personal information. When you authorize these P2P purchases, there is little to nothing your financial institution can do to help you regain those funds.

Consider this example: You have been talking with an unknown user on Facebook Marketplace about purchasing your family's first dog. Everything seems legitimate, so you send the money via Venmo. Now it's time to confirm the meet-up details, and the user immediately stops answering your messages and blocks you. You never hear from them again and never receive the dog you tried to purchase.

This is a common pattern exhibited by scammers posing as legitimate vendors will follow. They gain your trust using a legitimate-looking account and insist that you make your payment upfront. You make and authorize the payment from your account but never receive the item you were trying to purchase.

In these scenarios, the scammer now has the funds you have authorized to have sent to them and, depending on what other information you have provided, they may have additional details like your account information. Since you authorized the transaction and the transaction was processed without purchase protection, nothing can be done to recover those funds.

How to Protect Yourself

These scams are increasingly common. The best way to protect yourself is to stay informed. Follow the tips below.

• Do not act quickly.
• Making a new or big purchase, like a dog, can be exciting, but it's important to take your time and ensure the transaction is legitimate.
• Do not send money to unknown recipients.
• Use transfer money services to send money only to people you know and trust.
• Verify all recipients
• When adding a new recipient, or even sending money to an old one, be sure to review all contact information to make sure it is correct before you send money.
• If the person is a new contact, research as much as possible to confirm you are sending money to a legitimate recipient.
• Link your account to a credit card instead of a debit card.
• Using a credit card to make these purchases instead of your bank account can create an extra layer of security in retrieving stolen funds
• Lock your app when not in use.
• Many apps allow you to lock your account when you're not using it, either with a PIN, fingerprint or face ID. Enable this feature to prevent unauthorized access to your P2P apps if your phone is lost or stolen.

Don’t Fall for P2P Scams

Despite what scammers want you to believe, official institutions, like Members 1st, will never ask you to send money to them via these P2P apps. If you receive a request to send money via these apps, please contact a trusted source immediately. For instance, if you have questions about a communication that says it is from Members 1st, you can contact our Customer Service number or visit any of our branches.

Apps like Venmo and CashApp were designed to send money to people you know and trust. Any money transferred using these apps, including the Transfer Money Service on the Members 1st mobile app, should be treated like cash. Using apps for purchases can be risky and could result in stolen funds that cannot be recovered.

If you are ever unsure about a purchase or a request to send funds, we are here to help. You can give us a call or visit one of our nearly 60 branch locations.