Half of Zelle scams at JPMorgan Chase and other US banks can be traced back to a solitary origin, according to a report.

Report: Meta Platforms Fueling Zelle Scams on Bank-Owned Payments Network

Meta Platforms, the parent company of Facebook and Instagram, is allegedly contributing significantly to internet fraud on the popular bank-owned payments network Zelle, according to a new report. The Social media giant's platforms are becoming a "cornerstone of the internet fraud economy," reports the Wall Street Journal.

Citing people "familiar with the matter," the WSJ claims Meta accounted for nearly half of all reported Zelle scams at JPMorgan Chase between the summers of 2023 and 2024. Similar numbers are reported across all US banks, indicating a widespread problem.

Scammers are said to be exploiting Meta's oversight, cryptocurrencies, and generative AI to flood its platforms with fake ads for puppies, giveaways, and bargain goods. Internal Meta documents reportedly reveal that 70% of newly active advertisers on its platforms promote scams, illicit goods, or low-quality products.

Meta's Marketplace, now larger than Craigslist, has become a playground for scammers due to its peer-to-peer model. The company allows advertisers up to 32 automated "strikes" for financial fraud before banning accounts, a practice that critics argue prioritizes the company's $160 billion ad revenue stream.

In court, Meta has argued that it has no legal obligation to require advertisers to verify their identities or demonstrate that they're licensed to sell products. In response to the rising scams, JPMorgan Chase recently changed its Zelle policies, warning it may decline Zelle payments stemming from contact on social media.

Meta maintains that it's working with banks and tech companies to combat scams while deploying new tools like facial recognition and user warnings.

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Half of Zelle scams at JPMorgan Chase and other US banks can be traced back to a solitary origin, according to a report.