Financial scams have been steadily on the rise in recent years. In fact, the FTC reported that in 2023 alone, people have lost $10 billion to scammers.1 P2P, or peer-to-peer payment apps, like Venmo, Zelle, or Cash App, have become popular among younger generations as a quick and easy way to transfer money. But, they have also given these scammers a new avenue to access sensitive information. As you use these apps, here are some things to keep in mind to keep your teens protected.
Scammers might try a few different ways to gain someone’s trust. They may impersonate a financial institution alerting you about an urgent matter and have you send money to fix the situation. A financial institution will never ask you to do this.
Scammers could also pose as a business requesting payment for a product. Once they receive your payment, you won’t receive what you paid for, and the scammer will likely block your attempts to communicate.
You could also run into the “accidental” transfer. The scammer will send you a transfer and ask for the money back. Usually, these are stolen funds, so if you send the money back, the app’s fraud department may hold you responsible, and the funds will be taken from your account.
Once you send over the money, there is little chance you’ll get it back. So, it’s important to take steps to spot potential threats.
When using P2P apps, ensure your teens only transfer money with people you trust. If you’re dealing with an unknown person, verify all information, ask questions, and don’t feel pressured to do anything. You can also set up alerts for any account activity and enable multi-factor authentication for added security.
If you or your teen has fallen victim to a scam, there are a few things you can do. First, notify the platform you’re using and report the fraudulent activity. Then, contact your bank to see if they can help block any transactions and get you new account information if it was compromised.
You can file a complaint with the FBI’s Internet Crime Complaint Center.
You could also share your experience with other people on social media. Doing your part by calling out these scammers may help future victims.
Building healthy financial habits early can go a long way. Cybersecurity is just the start. From building credit to saving for retirement, there are always new things to learn. With the right tools, you can help your teens increase their financial literacy, get them real-world experience, and have them enter the adult world with confidence.
Cyprus Credit Union’s Learn & Earn accounts are designed to help teens learn financial skills, spend smartly, and earn real cash rewards up to $200.
Learn more about Cyprus Credit Union’s Learn and Earn accounts here.
1Facts about fraud from the FTC