Class Action Lawsuit Filed Over Alleged Wells Fargo Zelle Scam [UPDATE]

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A Seattle resident has filed a proposed class action in which he claims to have been the victim of a scam targeting Wells Fargo Bank customers who use the Zelle app. 

The 21-page lawsuit says that although the type of Zelle scam to which the plaintiff fell victim is well known to the collection of banks, including Wells Fargo, who own the instant money-sending app, no steps have been taken to protect or educate consumers given how much it would cost to enact such measures. 

According to the lawsuit, defendants Wells Fargo and Early Warning Services, LLC have failed to warn customers of the risks of using Zelle, which include the potential to fall victim to scams whereby someone tricks a consumer into sending money by impersonating their bank. As the complaint tells it, Zelle has become “a favorite among criminals.”

“Nowhere in Zelle’s marketing does Zelle warn potential users of the risks of being scammed by persons impersonating their banks,” the suit states. “Consumers are not aware that transactions with Zelle differ from other similar platforms.” 

The suit claims that although the plaintiff was wrongfully debited $7,500 through a Zelle scam, Wells Fargo has not reversed or refunded the money, despite being obligated to do so. 

“On information and belief, Wells Fargo Bank does not reimburse consumers for losses from [electronic funds transfers] via Zelle due to fraud, even where the losses are timely reported by consumers,” the case alleges. 

According to the lawsuit, a scammer reached out to the plaintiff and “mimicked” Wells Fargo’s identity. On December 23, 2021, the plaintiff received a text message that stated that there were unauthorized transactions on his Wells Fargo account and that he should reply “yes” if he wanted to receive a call about it, purportedly from the bank, the case relays. 

Soon after responding “yes,” the plaintiff received a phone call from a number that was identified on his caller ID as Wells Fargo Bank, and a person on the other end claimed to be a representative from the bank’s fraud department calling to confirm possible suspicious transactions on his account, the suit states. 

Per the case, the purported Wells Fargo rep informed the plaintiff that he needed to use the Wells Fargo app, specifically the Zelle function, to “delete and then re-add and pay himself as a Zelle payee.” By doing so, the scammer told the plaintiff, he would “confirm his identity and lock out the scammer from accessing his Wells Fargo account,” the suit says. 

During the process, the plaintiff was sent a verification code via text message that he was fraudulently induced to share with the scammer, purportedly to confirm himself as a payee to his Wells Fargo account, the case relays. 

According to the case, the plaintiff was led to believe during his phone call with the purported Wells Fargo representative that he had used the Zelle service to send $3,500 to himself. In reality, the scammers sent the funds from the plaintiff’s Wells Fargo account to their own accounts via Zelle on December 23, 2021, the suit relays.

On December 24, the plaintiff was informed by the same phone number from the previous interaction that there were additional unauthorized charges on his Wells Fargo account, and that he should reply “yes” to receive a call about it from the bank, the lawsuit continues. In the second call, the plaintiff “immediately raised concerns about the identity of the purported representative” from the bank, the suit relays.

Once more, the plaintiff was told that he had to delete and then re-add himself as a payee through the Zelle function of his Wells Fargo account, the case says. This time, the complaint states, the plaintiff sent $4,000 via Zelle to the scammers, despite believing, as he had the previous time, that he was sending the money to himself. 

Although the plaintiff disputed the transactions, Wells Fargo stated that it had completed its investigations by January 5, 2022, and told the consumer that it was refusing to refund him for any of the unauthorized transactions, the lawsuit says. In April, the bank, according to the case, reversed its position and credited the plaintiff with $3,500 back into his account. 

“Defendants knew or should have known of the likelihood of this type of scam and its financial detriment to consumers, including Plaintiff,” the suit argues. 

The lawsuit looks to represent all persons in the United States whose bank account with Wells Fargo was debited via one or more transactions using the Zelle app and was not permanently credited by Wells Fargo in full within 45 days of a dispute by the customer and/or the customer’s authorized representative concerning the transaction. 

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