Top 10 Venmo Scams – and How to Stay Safe

Scams

Here’s what to know about some of the most common tricks scammers use on the payment app

January 17, 2023
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5 min. read

Today’s consumers have a wealth of choice when it comes to paying and sending money online. A series of slick digital payment apps have emerged in recent years to make the entire process as seamless as possible for end users. But they are not the only ones who win.

Unfortunately, scammers have also found apps like Cash App, Zelle, and Venmo to be fertile hunting grounds.

The story so far

Venmo began life in 2009 as an SMS-based tool that gave its founders a convenient way to send each other money, without using cash or checks. Now part of PayPal, it’s a full-fledged digital wallet and payment service that allows users to send and receive funds quickly, easily and for free – via linked bank accounts. It processed an estimated US$230 billion worldwide in 2021.

However, unlike card payments, users are not protected if they accidentally pay a fraudster. Once the money is transferred, it is difficult to recover. This makes it important for users to spot the warning signs of fraud before it is too late.

Common Venmo Scams to Watch Out for

Venmo scams can take many forms. Some are linked to other types of fraud such as romance scams. Others may involve fake links, or attempts to steal not only money but also personal information. Here is one of the 10 most common at the time of writing.

1. False price/give away

A scammer sends an unsolicited email or text message claiming that the recipient has won money from Venmo. Sometimes they may be asked to take a fake survey to receive the winnings. Whatever the lure, the link attached to the message will usually take the victim to a phishing page designed to elicit personal and Venmo login details.

2. Buy scams

For online shoppers, especially those looking for items in high demand, there’s also a lot to watch out for. One of the simplest scams is for a fraudster to persuade the victim to send money (or part of it) without delivering the item in question. They may even share fake screenshots pretending to show that the item has been delivered. The scammer may also ask the victim not to mark a payment as a purchase. Doing so will allow the victim to qualify for purchase protection if an item is not delivered.

3. Payment error

Out of the blue, the victim receives a note from a stranger saying they were paid by mistake. They will ask the victim to send the money back. However, the original money was usually paid via stolen card details. So when the real cardholder finds out, they will request a chargeback and that money will disappear from the victim’s account.

4. Impersonation/money solicitation

Fraudsters sometimes impersonate victims’ friends by using information from their public feeds, including profile pictures, to make payment requests. They will usually add some kind of time pressure to force payment, such as pretending the friend is caught out without any cash and urgently needs a quick Venmo payment.

5. Venmo Phishing

In one variety, a fraudster manages to log into the victim’s Venmo account, perhaps by purchasing their username and password from a dark site. However, they cannot get past the two-factor authentication (2FA) stage. That’s why they’ll call, pretend to be a member of the Venmo team, and request that the user provide the MFA one-time password they’ll have received. The victim has just become the victim of vishing.

Let’s not forget the classic phishing scam where the brand receives a notification out of the blue saying that there is a problem with their account and they need to take immediate action to fix it.

6. Pyramid scheme/money circle/cash wheel

There are different names for this scam, but they all boil down to the same thing. The victim receives an unsolicited offer claiming that if they send a small amount of money via Venmo, the scammer will “flip” it into an amount worth many times more and send it back. They may impersonate one of the victim’s contacts to lend legitimacy to the ridiculous claim.

7. False payments

If users are trying to sell an item online, such as via Facebook Marketplace, scammers may try to use Venmo to trick them into believing a payment has already been made. This may include a fake screenshot pretending to confirm the payment. Or the scammer can pay with stolen card details, meaning the payment is subsequently removed from the victim’s Venmo account. They may even try to trick the victim by telling them the Venmo payment will only be confirmed once the item has been shipped, and shipping details have been uploaded to the app.

8. Check for scams

A victim tries to sell an item on an online marketplace. The scammer sends a check for more than the agreed upon amount, then requests that the extra be sent back to them via Venmo. The check will usually bounce, meaning the victim is off the item and the money they sent.

9. Tricks by fake suitors and sugar daddies

Using fake profiles, romance scammers cultivate relationships with lonely hearts on dating sites, then move the conversation onto unpoliced ​​channels like WhatsApp. After a few weeks of trust and affection, they will usually ask the victim to send them money for a made-up emergency, such as hospital bills or plane tickets. Fake sugar daddies or mommas also have similar tricks up their sleeves.

10. Rent deposit scam

Scammers advertise properties for rent using deleted pictures and information. The property will usually be offered at a price well below the market rate, attracting numerous enquiries. The victims will be asked to pay a deposit via Venmo before even seeing the location.

How to Stay Safe on Venmo

Venmo offers several security protections for its users, including data encryption, account monitoring, 2FA, and account PIN codes. However, this does not always protect users from the fraud scenarios we have painted above.

Make sure you take the following precautions:

Only send and receive money from people you know and trust. If you receive a strange request from someone you know, check with that person to confirm that the message was authentic. Do not click on any links in unsolicited messages. Keep your Venmo transactions private so that they are visible only to the sender and receiver. To select this option, you may need to go to ‘Settings’, tap on ‘Privacy’ and change your ‘Default Privacy Settings’ accordingly. Choose a strong and unique password for your Venmo account and turn on 2FA.

Venmo also offers a contact form for users who have received a request they are unsure about, and a mechanism to report suspected scams. Be sure to stay alert for fraud when using Venmo.

BEFORE YOU GO: 10 reasons why we fall for scams