Do cash apps make it too easy for thieves to empty accounts?

Manhattan District Attorney Alvin Bragg has written letters to the makers of cash apps such as Venmo, Zelle, and Cash App, urging them to do do more to protect consumers from fraudulent transfers when unauthorized users gain access to unlocked devices. Link to an article by Ashley Belanger in Arts Technica here.

"Thousands or even tens of thousands can be drained from financial accounts in a matter of seconds with just a few taps," Bragg said in letters to app makers. "Without additional protections, customers' financial and physical safety is being put at risk."

According to Bragg, his office and the New York Police Department have been increasingly prosecuting crimes where phones are commandeered by bad actors to quickly steal large amounts of money through financial apps.

This can happen to unwitting victims when fraudsters ask "to use an individual's smartphone for personal use" or to transfer funds to initiate a donation for a specific cause. Or "in the most disturbing cases," Bragg said, "offenders have violently assaulted or drugged victims, and either compelled them to provide a password for a device or used biometric ID to open the victim's phone before transferring money once the individual is incapacitated."

Bragg points to Apple's new "Stolen Device Protection," offered for iOS 17.3, as evidence that tech companies can do more to protect consumers. That feature requires Face ID or Touch ID, not just a passcode, if some sensitive actions on the phone are attempted while the phone is not in a familiar location, like your home or workplace. Security Delay requires Face ID or Touch ID, then an hour's delay before certain important actions can be performed.

Bragg believes the financial companies should make similar features available for their apps, so that they can block or delay suspicious transactions, such as large transfers, or transfers attempted away from a familiar location.

Ars Technica reports that none of the cash apps contacted by Bragg confirmed whether they had any plans to meet with Bragg.