5 common Venmo scams and what to look out for
January 08, 2024
For every payment method, there’s a scammer who knows how to abuse it.
Venmo, which is relatively new to the scene — launching in 2009 and gaining massive popularity in the 2020s — provides a fresh avenue for defrauders to take your money. While it has some security features, you can get scammed on Venmo.
Here’s how to avoid Venmo scams and continue to use this app to make quick transfers — without compromising your data or cash.
What is Venmo?
Venmo is a financial mobile app that hosts peer-to-peer (P2P) money transfers. It’s best known for informal social deposits between friends or family members who want to pay one another quickly in scenarios like splitting restaurant bills.
Since its foundation, Venmo’s services have expanded to include payment processing for online stores, credit and debit cards, and business accounts — even a crypto investment feature. The best part is it’s all free to use, though you do have to pay an automatic 3% fee for credit card transactions.
Is Venmo safe?
Venmo has several features that make it a safe choice for money transfers. The app encrypts transactions and uses multi-factor authentication when confirming users’ identities. Venmo also monitors for suspicious activity and lets you lock your account if you lose your phone or another connected device.
While Venmo takes many safety measures, scammers have found ways to work around them — often by manipulating you into sending them money or handing over data. Despite the app’s safety features, both personal and business Venmo users need to keep an eye out for potential scams.
5 common Venmo scams and how to avoid them
While you might think you’d never let someone else access your Venmo, scammers present scenarios that seem real. You won’t know it’s happening until it’s too late — unless you’re aware of what scams look like and can spot them fast. Here are five common payment app scams to know:
1. Accidental transfers
In this scam, a Venmo user you don’t know sends you a deposit. This user is a scammer who will write to you after making the transfer, claiming it was a mistake. They’ll apologize and ask for the money back.
In reality, the person didn’t send you liquid funds. The money the scammer “accidentally” sent you is likely from a stolen credit card, and once Venmo detects this nefarious move, they’ll withdraw the stolen funds from your account. And if you’ve already sent your real cash to the scammer, you can’t get it back.
You can protect yourself from accidental transfer scams by reporting the situation to Venmo instead of sending any money.
2. Fake buyers
Fake buyers purchase an item from you on an online platform like eBay or Facebook Marketplace and offer to pay on Venmo. After you give the item to the fake buyer, they’ll retract the funds, keeping the item without ever rightfully paying for it.
There’s also a fake seller version of this fraud. In Venmo business account scams, users pretend to offer goods or services and insist that you pre-pay. They’ll keep your money and never send or provide the item or service you paid for.
Venmo dissuades users from taking payments from strangers because it could be payment app fraud. Stick to only the commerce options online marketplaces recommend, as these sites can protect your transactions better. You can also prevent seller scams by paying for goods or services only after receiving them.
3. Romance scams
In a romance scam, a person you meet on a dating site — and form a bond with — will ask you for a Venmo deposit. The individual’s story may seem reasonable, like wanting you to help pay for half of the travel expenses so they can meet you in person. But this potential romantic partner is a scammer who just wants your money. When you send it to them via Venmo, they’ll likely ghost you.
Romance scams are prevalent with many payment forms, from gift cards to PayPal and beyond. Protect yourself by never sending money to someone you haven’t met.
4. Phishing and smishing
Phishers, who rob your personal information through email, and smishers, who do the same via SMS messages, pretend to be Venmo employees in an effort to grab your data.
In Venmo email and text scams, a cybercriminal will send you a message asking you to update your payment information at a link. This link may install spyware on your device or appear to go to Venmo’s site, which is really a nefarious webpage that records the data you enter. In both methods, you accidentally give the phisher or smisher access to your payment or personal information.
Protect yourself from a phishing or smishing scam by never clicking on links in emails or text messages unless you’re 100% sure they’re from Venmo. Never update your personal information via a link or provide personal data if “Venmo” requests it in an email or text. If you’re unsure, contact Venmo support directly, and they’ll deny or confirm the text was from them.
5. “Stranger in the street” scam
A stranger in the street may approach you pretending they’re having an emergency and need to use a phone. If you’re kind enough to lend them your cellphone to make said call, they’ll quickly open the Venmo app and transfer money to themselves.
A stranger may legitimately ask to borrow your phone in an emergency, so you can protect yourself from this scam by entering the number they wish to call for them and handing them the phone only once it rings. You can also ask the person to send you a text message first so that you can report their number if they make a Venmo transfer from your phone.
5 signs it’s a Venmo scam
Learning to spot scams keeps you safe, and there are a few telltale signs of Venmo scams to watch out for. Be wary if:
Someone sends you a link asking you to click to update information
You receive a message supposedly from Venmo that doesn’t address you by name
A person pressures you to accept payment for an item or service via Venmo, even when there are other viable options
You get a deposit from a stranger
There’s a sense of urgency in a stranger’s messages
Protecting your Venmo accounts from scams
The best way to prevent scams is to put safety measures in place before they happen. You can further your digital security by:
Regularly monitoring your account for anomalies, like requests or transfers you don’t recognize
Using a safe password that doesn’t contain any identifying information a criminal could find online (like your birthdate)
Linking a credit card to Venmo instead of a debit card, as fraudulent purchases on the former are easier to cancel and recoup
Creating a “Private” or “Friends only” Venmo profile so nobody can see your activity
Securing your Venmo account with IronVest’s biometric authentication protection
What to do if you get scammed on Venmo
If you get scammed on Venmo, say something. You can possibly stop or recover a fraudulent payment before things get worse, and you’ll prevent it from happening to other people. Here’s how to report a Venmo scammer and protect your accounts:
Fill out a contact form and alert Venmo of the situation.
Delete your payment methods from your Venmo account, change your password, and then add your payment methods once you’re sure nobody else has access.
Report any suspicious activity to your bank and freeze accounts a criminal has gained access to.
Alert the Federal Trade Commission (FTC) of the scam.
Keep your data safer with Ironvest
A Venmo scam could happen to anyone. Safeguard your data with better digital security — protecting your money and data so if someone does gain access, they won’t get far.
Download IronVest’s super app for maximum privacy. Its comprehensive features include biometric authentication, virtual credit cards, and masked emails to keep your information safe and make sure only you access your accounts. Get IronVest today and enjoy peace of mind.