Headline May 25, 2018/ ''' SWINDLERS DIGITAL SWEEPERS '''


IN THE DEVELOPING RISE of *Proud Pakistan* it was after much and many urgings that the  Telecom Authority went on -

To develop a system to discourage spread of counterfeit mobile phones. Just as the number of  broadband users in Pakistan crosses 50 million mark.

But in Super Power America, the world of finance and digital transfers spun in a manner that got the Swindlers to make very quick bucks with digital transfers.

LAST NOVEMBER, Mr. Kemm tried to send to his mother, Carol Kemm, who is also Bank of America customer.

He typed in the mobile phone number Ms. Kemm had been using for the least three years and hit  ''send''.

''She told me she didn't get it, and my first thought was, 'Mom, you're not being very tech savvy,'' Mr. Kemm said. ''Eventually, after a few days, I realized it really didn't get there.''

When he called Bank of America's customer service line, he learned that the $300 had been transferred - to JP Morgan chase bank account, whose owner had registered the same phone number Ms Kemm used.

He said he been told that there was nothing bank of America could do get his money back.

BIG BANKS ARE MAKING it easy to zap money to your friends. Maybe just far too easy.

Zelle, a service that allows bank customers to send money instantly to their acquaintances, is really booming. Thousands of new users sign up every day.

Some $75 billion zoomed through Zelle's network last year. That's more than twice the amount of money that customers transferred with Venmo, a rival-money transfer app.

But the same features that make Zelle so useful for customers, its speed and ubiquity, have made it irresistible to thieves.

Hackers and con artists have used the system to steal from victims - some of whom had never used Zelle or even heard of it until someone used it to clean out their bank accounts.

Interviews with more than two dozen customers whose money was stolen through Zelle illustrate that weaknesses that criminals are using in focusing on the network.

While all financials are susceptible to fraud, aspects of Zelle's design, like not always notifying customers when money is transferred - some banks do; others don't - have contributed to the system's vulnerability.

And some customers who lost money were made whole by their banks; others were not.

For the banks, Zelle is a big - and must win - bet on where is money is headed. As consumers become increasingly accustomed to splitting dinner checks, paying for their coffee and hailing an Uber without touching paper money, banks are rushing to stake their claim on the wallet of the future.

In recent years, apps such as Venmo {which is owned by Paypal}, Popmoney, Square Cash and Apple Pay have made digital transfer quick and simple.

Banks were falling behind. So they joined up to create a rival product, run by Early Warning Services, a Scottsdale, Ariz, consortium that is jointly owned by seven large banks.

Last June, Early Warning introduced Zelle, It is built directly into each bank's mobile app, making the system easy to use for customers - or thieves who gain access to their accounts.

The scale of the problem is hard to pinpoint, because Zelle is fairly new and banks do not report much data about it. But banking analysts say they have seen some alarming incidents.

''I know of one bank that was experiencing a 90 percent fraud rate on Zelle transactions, which is insane,'' said Genevieve Gimbert, a partner in PwC's financial crimes unit.

Most banks have strong authentication and fraud-detection controls for Zelle, she said, but some ''just implemented it without any protections'' like two-factor authentication and user-behavior monitoring.

Zelle said the problem was under control. ''There are very few incidents,'' said Lou Anne Alexander,  Early Warning's head of payments.

''When there's a problem, we and the banks are proactive. It's not something we are putting our heads in the sand about.''

Eighteen banks in the United States, including most of the biggest players, are using Zelle, and 70 more are setting it up. Collectively, they connect about half of the traditional checking accounts in the United States.

Cash transfers within the network often take place within seconds - much faster than on most of its rival rival payment services, that has made it more difficult for banks to halt or reverse illicit transactions. 

Security is cornerstone of  Zelle's marketing campaign.

In one TV commercial, Daveed Diggs, an actor and rapper known for ''Hamilton'' and ''black-ish,'' is encourage to pay for payoff tickets through Zelle by another actor who raps :

''You can send money safely, 'cause what it's for, and it's backed by the banks, so you know it's secure.''

But the system has had problems. Brian Kemm, a Bank of America customer in Pasadena, Calif, lost $300 because of misdirected payment.

To transfer money through Zelle, the sender enters the recipients phone number or email address.  Zelle is built on the assumption that each of those identifiers is unique to one person.

The Honor and Serving of the latest  Operational Research on technology and Digital Transfers continues. !WOW! thanks author and researcher Stancy Cowley.

With respectful dedication to the All the Great Banks the world over, the Students, Professors and Teachers.

See Ya all ''register'' on wssciw.blogspot.com - The World Students Society for every subject in the world and Twitter !E-WOW! - the Ecosystem 2011:

'''Shapes & Swindlers'''

Good Night and God Bless

SAM Daily Times - the Voice of the Voiceless


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