Frequent moves, and the financial hurdles that come along for the ride, make military members and their families more likely targets for scams involving payment apps, according to a June report from the Consumer Financial Protection Bureau (CFPB).

More than 1,118 members of the military community – servicemembers, veterans, and military families – filed payment app-related complaints with the CFPB in 2022, up from 790 the previous year and nearly double the 2020 reports (636). More than half the complaints involved some type of fraud or scam.

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The report puts much of the blame on PCS-connected issues, such as:

• Increased use of the apps to cover rental or automobile deposits, advance child care payments, or other sight-unseen transactions that could leave the buyer ripe for scammers.
• Fraudulent home or apartment listings that request the use of payment apps for deposits or other payments.
• A greater risk of identity theft brought on by the frequent need to share personal information as part of the moving process. Scammers who obtain personal data may use it to access payment apps and impersonate the servicemember.

One servicemember described losing nearly $34,000 in an identity theft scam, with $9,500 of that lost via a payment app service. Others discussed the aftershocks of dealing with such fraud – being locked out of apps and bank accounts, sometimes for indefinite periods, while disputing a charge. Another servicemember described paying off a fraudulent charge simply to avoid debt collection and the possibility of a negative credit report.

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Stopping the Scams

The report suggest the app providers should invest more in anti-fraud technology, improve customer service when it comes to fraud complaints, and “take a comprehensive approach to reimbursement” for servicemembers. The Federal Trade Commission (FTC) offers advice on the consumer side of the app:

• Do not share app credentials.
• Think before you send – if you’ve been asked to send a payment to collect a prize, for example, it’s likely a scam.
• If you receive an unexpected request for money, even if it’s from a name or an email account you recognize, reach out and confirm before sending any funds.

The FTC link also includes instructions to report potential scams to some of the more popular payment apps, including Cash App, PayPal, and Venmo.

MOAA Can Help

Check out the following MOAA.org resources for facing down frauds of all types:

• From our financial and benefits expert: Protect Yourself From These 5 Common Fraud Schemes
• Three-part series: Don’t Be Scammed
• Recorded webinars (available to Premium and Life members): An Overview of Scams and Frauds | Outsmart the Scammers: How to Spot and Avoid Financial Fraud | Protecting Yourself From Cybercrime and Scams