Lisa, Britney and Carla call themselves the “Sister Swifties.” They created that nickname years ago, before Taylor Swift’s Eras Tour was even a glimmer in their eyes. Naturally, from the moment the tour was announced, they tried desperately to get tickets. The Sister Swifties were sadly left empty-handed when the shows sold out in seconds, basically breaking Ticketmaster. As the tour got into full swing and social media exploded with Eras Tour content, the group was looking for tickets everywhere. They found some, and thought they did the right things to make sure they weren’t getting scammed. Turns out, it was exactly that – a payment scam.

Can you spot where they missed the red flags?

Unfortunately, for the Sister Swifties, they were right. It was too good to be true. Banks and credit unions can provide consumer protection from fraud in certain instances. However, those protections do not apply when you do, in fact, authorize an electronic payment. That was the case in this scenario, and the hopeful concertgoers lost their money.

Payment Scam Red Flags

First, payment scams can happen on any peer-to-peer payment platform, including:

  • Venmo
  • PayPal
  • Cash App
  • Zelle
  • Apple Pay
  • Google Pay
  • Samsung Pay
  • Facebook (Meta) Pay

You must remember that once you send money, it’s gone. How could these sisters have spotted the scam? Did you notice moments where they made hasty decisions with little thought? Did you identify any red flags that should have prompted them to pause? Let’s review some red flags they danced right over.

  • As Britney pointed out, the ticket price was too cheap for how good the seats were (too good to be true).
  • The scammer blacked out portions of the ticket screenshots (suspicious).
  • Carla mentioned that Ticketmaster probably offered a way to purchase/transfer tickets, but Britney and Lisa ignored her suggestion. They moved right into talking about transferring payment through Venmo. That’s exactly what the scammer wanted – a quick decision, ignoring common sense (rushed decision).
  • The scammer acted like she was nervous that Britney would scam her when negotiating. Fraudsters love using reverse psychology to seem more legitimate.
  • The scammer requested the payment be sent to a Venmo account with a different name (highly suspicious).
  • The email the scammer provided was not a real email account and was not recognized by Venmo.
  • Once the initial $400 was sent, the scammer claimed she misunderstood their agreement and needed an additional $400 before sending the tickets. Britney reviewed the exchange and realized that their conversation and agreement was very clear and didn’t leave room for misinterpretation.

Can you spot anything more? The sisters suspected a possible fraud scheme the entire time, yet still ignored all of the above red flags. They let their excitement cloud their judgement and skipped over the vital research process. In the end, distractions and urgency cost them $800.

Skyrocketing Payment Scams

Unfortunately, payment scams happen all the time. According to Consumer Reports (2022), 18% of consumers use a payment app once a week. Of these heavy users, half of them reported being scammed in the past. Fraudsters are getting bolder too. The average dollar amount of fraud attempted through a payment app is 60% higher than the average credit card fraud.

Preventing a Payment Scam

Here are some tips to help you prevent a payment scam.

1. Question the Transaction

Ask yourself if using a peer-to-peer payment app makes sense for your transaction. You should only use these apps with people you know and trust, if possible.

  • Never send money in order to receive money.
  • If you’re buying a product or service, always use the “Goods and Services” option – you’re offered protection through the app if it ends up being a scam. Do not believe anyone who says you must use “Friends & Family”. If they’re concerned about getting a fee, offer to pay the fee on top of whatever they’re charging.

2. Verify Who You’re Sending Money To

Always double-check the recipient’s information to make sure you’re sending money to the right person, even if it’s someone you know. A good practice is to have the intended recipient send you a request before you send the money.

  • It’s probably a scam if you’re buying something (tickets, sneakers, something off a Facebook group), and the person asks you to send money to someone else, or requests it from an account that isn’t theirs. If they’re local, ask to meet in person in a public place.

3. Review Your Protections

Familiarize yourself with the fraud protection policies of the peer-to-peer payment app that you are using. You need to understand if and how you can recover money if you get scammed.

4. Reconsider How Your Account is Linked

If your payment app is linked to a checking account, consider linking it to a credit card instead. A credit card provides added protection if you don’t receive the goods or services you purchased.

5. Protect Your App

Protect your payment app and log in with the strongest authentication available, like Face ID or Touch ID, two-factor authentication, a strong password, or a PIN. Turn off automatic login settings and set up notifications for all payment transactions.

We suggest you STOP and THINK if something appears too good to be true. Isn’t it a little weird if there’s some hot, new item on the market that no one can find (a toy, sneakers, etc.), but you see it on social media at a discount? If tickets for a concert are going for thousands of dollars a piece, why is this person selling them for $400 each? It’s not always a “good deal.”

 

We’re Here to Help

If you think you got scammed, or even just want some advice on a situation, our experts are here to help. We’ve seen a lot of fraud and scams, and are happy to help you figure out if it’s real or not. Call, text, or chat with us, M-F, 9am-4pm ET. (315) 671-4000.

 

Adapted from Liza Gillan, Vice President, Operational Risk & Compliance, Alloya Corporate Federal Credit Union