Cyber crime

Avoiding P2P fraud when making digital payments with Zelle, Venmo, PayPal and Cash App

Bristol James
4 Min
How to avoid p2p fraud

P2P payments – often called peer-to-peer payments or person-to-person payments – are digital payments made using applications like Zelle, Venmo, and PayPal. Unlike electronic funds transfers between bank accounts, P2P payments are usually instantaneous, ridding the payment process of banking delays. Although P2P platforms are more convenient than writing checks, using credit or debit cards, or coordinating wire transfers, P2P fraud can open users up to security breaches and theft.

What is P2P fraud?

P2P payment fraud occurs when a scammer exploits these platforms to steal money from unsuspecting victims. Scammers may request funds for services that weren’t provided, trick someone into sending funds, or even hack into their victim’s account to fraudulently send funds to themselves. By understanding how P2P fraud works, you can better protect your personal and/or business accounts from these scams.

P2P Fraud Impact

As P2P payments grow in popularity – more than 64% of Americans use P2P platforms to send or receive funds – the impact of P2P fraud rises, too. In 2022, P2P fraud losses saw a 90% increase from 2021, resulting in $1.7 billion of lost funds. Many users don’t understand the liability protections that they’re forfeiting when using these applications; most banks will not reimburse losses from P2P fraud in the same way that they cover instances of cash or credit card fraud.

Popular P2P Scams

Because most P2P payments are made by the owner of the account, they are considered “voluntary,” making it hard to recover funds when scams are successful. To avoid P2P fraud, watch out for the following:

Phishing Scams

Phishing is when scammers can send you a text or email claiming that your account with a specific P2P platform is locked or in jeopardy of some sort. They may send a link to have you input your login credentials or other information. When you click the link, malware can be installed on your device, or your credentials can be stolen to gain access to your account.

Accidental Transfers

If an unknown user sends you money on a P2P application and then reaches out to explain that it was an accidental transfer, be weary. The funds they sent in the first place were likely stolen from somewhere else, and your account could get flagged for fraud. Instead of sending funds back to the user directly, reach out to the platform’s customer support team immediately.

Bank/Utility Impersonators

Often, bad actors will call your phone pretending to be a representative from a financial institution or utility provider — such as the gas & electric company you use – and create an “urgent” situation that needs your response. They may say that your payment never came through and instruct you to send a P2P payment to a fraudulent account before they shut your services off. These institutions will not reach out to communicate by phone; if you receive a phone call that sounds like this, hang up and call the utility company or bank directly.

Goods or Services Fraud

Something as simple as trying to purchase used furniture from an online marketplace can be exploited as P2P fraud. Let’s say you want to buy a dresser from someone, and they instruct you to send the funds before delivery, then never show up with the dresser. At that point, your funds are gone, and there’s not a lot you can do to get it back. Individuals and fake “businesses” can use this tactic to steal money from you.

Protect P2P Transactions

With a bit of due diligence, avoiding P2P fraud is very possible. Use these 8 tips to protect your assets:

  1. Only use P2P platforms to send money to trusted contacts that you know personally.
  2. Treat these transactions like cash – once the money is sent, you can’t get it back.
  3. Never share your login credentials. Not over the phone, not via text, not through a link.
  4. Keep your applications and phone software updated to ensure the best cybersecurity protections are in place.
  5. Don’t send funds back to strangers who claim to have sent them to you on accident. Reach out to the customer support team at Venmo, PayPal, or the platform in question.
  6. Utilize multi-factor authentication for your account logins. This prevents hackers from logging into your account on their devices.
  7. Business users should always opt for secure payment platforms like Eftsure instead of using P2P platforms to send or receive funds.
  8. If you suspect you’ve been a victim of P2P fraud, contact the P2P platform and your bank immediately.


  • P2P fraud occurs when scammers use platforms like Zelle, Venmo, Cash App, or PayPal to steal funds. They may use tactics such as “accidental” transfers, phishing, or impersonation.
  • This phenomenon is impacting more people every year; 2022 saw $1.7 billion in losses, and that number is expected to continue rising.
  • By only sending money to users you know personally, protecting your login credentials, and ensuring your accounts are updated, you can mitigate the risk of P2P fraud.

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