Local man loses hundreds of dollars through fraudulent Zelle transactions

A local man with a disability and living on a fixed income was scammed out of hundreds of dollars on a popular cash app, trusted by the nation’s largest banks.

“Someone needs to be held accountable for this,” Larry Allebach tells 11 Investigates. “Not me.”

Now Congress is on the case as the feds report Americans losing $10 billion from fraudulent transactions through Zelle in 2023 alone.

“The banks of America have a dirty little secret,” Sen. Richard Blumenthal (D-CT) says. “It’s called Zelle.”

When we met Larry Allebach in his Mount Troy neighborhood, he had this to say to the person who stole from his checking account five times, using Zelle fraudulently:

“Oh, you’re a no good, dirty, rotten scumbag, taking advantage of senior citizens on disability.”

He showed us his bank statements and the five unauthorized Zelle transactions from May.

“One was $639, one was for $400, one was for $100 and one was for $95.”

The total was $1,431.12 sent to someone he doesn’t know. He says he’s on a fixed income, and this is a lot of money.

“I disputed that twice,” Allebach said. “Got the same answer both times. It’s a valid transaction.”

A “valid” transaction Huntington Bank says Allebach is on the hook for. It has even been sent to collections. The amount is just shy of what he gets for his monthly social security disability check.

“You can try to collect the money, but good luck,” Allebach tells his now former bank.

Zelle is owned and operated by the nation’s seven largest banks and while fraud is possible with all peer-to-peer cash apps, Senator Richard Blumenthal (D-CT) who is also the Chairman of the Permanent Subcommittee on Investigations, says Zelle is by far the largest, fastest and most permanent.

“The banks are failing to do what they should to protect consumers,” Blumenthal said during a subcommittee hearing. “Zelle and the big banks have said they couldn’t help.  What they mean is they wouldn’t help. Their attitude has been ‘Not our problem.’”

We reached out to Huntington Bank for a comment about Allebach’s situation and to see if they’ll reinstate his money.

Huntington Bank tells 11 investigates:

“We cannot comment on individual customers or their accounts. At Huntington, we work to educate our customers to help them avoid becoming a victim of a fraud scam. We recommend the following:

• Only use Zelle to send money to people you know and trust.
• Treat Zelle like cash. Once a Zelle payment is authorized to an enrolled recipient it can’t be canceled.
• Do not share account login information—neither Huntington nor Zelle will ever call, email, or text asking for login credentials.”

We also reached out to Zelle for comment, but didn’t hear back.

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