Venmo Fraud

In 2025, the threat of Venmo fraud has escalated, impacting consumers across the nation.

Fraudsters often exploit stolen devices to access accounts and execute unauthorized transfers, leaving victims with unexpected financial burdens.

At Dilendorf Law Firm, we stand ready to help you navigate these challenges.

Our commitment is to provide experienced legal assistance nationwide, ensuring that your rights are protected and that you receive the support needed to recover your funds.

Understanding Venmo Fraud

Venmo is a popular mobile payment platform that allows users to send and receive money digitally with ease.

It offers a convenient and social way to split bills, pay for goods and services, and manage everyday transactions by linking bank accounts, credit cards, or debit cards directly from mobile devices.

Owned by PayPal, Venmo has become especially popular among younger consumers due to its user-friendly interface and integrated social features.

However, as its use has expanded, so have the risks—unauthorized transactions, often referred to as Venmo fraud, can occur when funds are transferred without the user’s knowledge or consent, potentially resulting in unexpected financial losses.

This type of fraud commonly occurs through several distinct scenarios:

Stolen Phones Leading to Unauthorized Transfers

When a phone is stolen—particularly if it is unlocked or contains saved Venmo credentials—the thief may access the account and initiate transfers.

These unauthorized transactions can deplete funds rapidly, often before the account holder becomes aware of the breach.

Cybersecurity Breaches and Account Compromises

Cybercriminals may exploit weaknesses such as inadequate passwords, phishing tactics, or other security vulnerabilities to gain entry into a Venmo account.

Once access is obtained, they can perform transactions without the account holder’s authorization.

The consequences of Venmo fraud extend far beyond immediate financial loss.

Victims often experience significant stress, disruptions to their personal financial stability, and potential harm to their credit ratings.

The emotional burden, coupled with the effort required to resolve these incidents, amplifies the difficulties posed by such fraudulent activities.

At Dilendorf Law Firm, we offer comprehensive, nationwide legal support for cases involving theft and unauthorized transfers on Venmo.

We are experienced in complex situations—whether your phone was stolen or your account compromised—providing clear, effective assistance to protect your rights and help you recover your funds.

Legal Framework and EFTA Claims

The Electronic Funds Transfer Act (EFTA) is designed to shield consumers from unauthorized electronic transactions.

Under the EFTA, financial institutions must investigate and resolve disputes arising from fraudulent transfers, providing essential protection for your funds.

Importantly, even if your device or phone is stolen, your EFTA claim remains valid—ensuring that you can pursue recovery for unauthorized transactions.

Venmo is held liable under the EFTA for these transfers, meaning that if your account is compromised, you have a legal pathway to seek compensation.

Steps to Take if You’re a Victim of Venmo Fraud

• Document the Fraud:

Immediately record details of any unauthorized transactions. Save screenshots, transaction records, and any communication that could serve as evidence.

• Contact Your Financial Institution:

Notify your bank or credit card provider right away.

• Secure Your Account:

Change your Venmo password, enable two-factor authentication, and review your account settings to enhance security and prevent additional breaches.

• File a Police Report:

Report the incident to local law enforcement. A police report not only provides a record of the fraud but also supports your case for legal action.

• Notify Venmo:

Inform Venmo’s support team about the fraudulent activity so they can initiate an investigation and take steps to secure your account.

• Consult with a Legal Expert:

Consider reaching out to a lawyer who is well-versed in cyber fraud and electronic funds transfer cases. Contact Dilendorf Law Firm for a free consultation.

Relevant Statues and Cases

1. Electronic Fund Transfer Act (EFTA):
   • The EFTA was enacted to protect consumers in electronic fund transfer systems, including platforms like PayPal, Veem, and Venmo. It establishes the rights, liabilities, and responsibilities of consumers, financial institutions, and intermediaries involved in electronic fund transfers (Yuille v. Uphold HQ Inc., 686 F.Supp.3d 323 (2023)).
   • The EFTA mandates specific disclosure obligations for the terms and conditions of electronic fund transfers, requires financial institutions to provide documentation of the transfers, and imposes obligations to investigate and correct errors, including unauthorized transfers (Yuille v. Uphold HQ Inc., 686 F.Supp.3d 323 (2023)).
   • The EFTA also includes provisions for civil and criminal penalties for violations and allocates enforcement responsibilities among various federal agencies (Michigan First Credit Union v. T-Mobile USA, Inc., 108 F.4th 421 (2024)).
2. Regulation E:
   • Regulation E, which implements the EFTA, imposes an array of disclosure duties on providers of financial services, including those operating on platforms like PayPal, Veem, and Venmo (PayPal, Inc. v. Consumer Financial Protection Bureau, 728 F.Supp.3d 31 (2024)).
   • It requires financial institutions to investigate and resolve errors reported by consumers within specific time frames and to provide provisional recredit if necessary (In re Bank of America California Unemployment Benefits Litigation, 674 F.Supp.3d 884 (2023)).
3. Case Law:
   • Nero v. Uphold HQ Inc.: This case discusses the EFTA’s purpose to protect consumers and the need for clear application of consumer protection legislation to electronic fund transfers.
   • Foreman v. Bank of America, N.A.: This case highlights the legislative history of the EFTA, emphasizing its role in preventing fraud, embezzlement, and unauthorized use in electronic transactions.
   • PayPal, Inc. v. Consumer Financial Protection Bureau: This case confirms that the EFTA and Regulation E impose disclosure duties on financial service providers, which would include platforms like PayPal.

Contact Us

If you’ve been a victim of Venmo fraud, you don’t have to fight alone.

Dilendorf Law Firm is here to help you explore your legal options and work toward recovering your lost funds.

Contact us today at (212) 457-9797 or email info@dilendorf.com to explore your legal options.

Resources

1. Step-By-Step Guide Using Venmo to Make a Payment
2. Governor Healey Signs Money Transmission Bill that Protects Consumers Using Payment Apps like Venmo and PayPal
3. Do you use payment apps like Venmo, CashApp, or Zelle? Read this
4. PayPal and Venmo Frequently Asked Questions (FAQs)
5. PayPal, Inc., In the Matter of | Federal Trade Commission
6. Superintendent Adrienne A. Harris Secures $2 Million Cybersecurity Settlement with PayPal, Inc.
7. Cryptocurrency | Department of Revenue – Taxation
8. Attorney General Sunday Warns Consumers to be Aware of Trending PayPal Scam
9. PayPal Settles FTC Charges that Venmo Failed to Disclose Information to Consumers About the Ability to Transfer Funds and Privacy Settings; Violated Gramm-Leach-Bliley Act
10. Manhattan District Attorney Alvin Bragg, Jr., Calls On Venmo, Zelle, Cash App To Better Protect Consumers From Fraud