Scams have evolved into an industry. Combating them requires an equally sophisticated and coordinated industry response.
That's the key takeaway from a recent PYMNTS discussion featuring Brian Boates, chief risk officer at Block, Dave Szuchman, head of global financial crimes at PayPal, and Angelena Bradfield, head of policy at the Financial Technology Association. The conversation dove deeper into PYMNTS Intelligence research commissioned by Block, revealing both the scope of the challenge and the collaborative path forward.
The numbers are staggering. Nearly four in 10 U.S. households have been targeted by scams in the past five years. Americans lose billions of dollars annually to fraudsters who are becoming increasingly sophisticated, leveraging AI-generated voices, deepfakes, and social engineering tactics that exploit our most basic human instincts: trust, urgency and fear.
But scams aren't just a consumer problem or a single company's challenge. They're a systemic threat that demands a coordinated response across the entire financial services ecosystem.
As Brian Boates noted in the discussion, "When a lot of us think about the typical profile of a scam victim, we often think of elderly customers. But these days, it's not just older customers falling victim to scams, but it's also a lot of Gen Z and Millennial customers as well. Scammers don't discriminate."
This reality underscores why collaboration is essential. Scammers move across platforms and leverage any opportunities they find. That's why we need to work together by sharing intelligence, aligning on best practices, and building defenses that protect people no matter where they interact with the financial system.
The scam landscape has fundamentally changed. PYMNTS Intelligence research shows that more than two-thirds of victims authorize payments within 24 hours of first contact with a scammer, and nearly one in four send money within 30 minutes. In 81% of successful scams, criminals posed as trusted authorities, such as banks, government agencies, well-known companies, or even the victim's own contacts.
Traditional fraud prevention tools, built primarily to detect unauthorized transactions, weren't designed for this reality. When someone is tricked into authorizing a payment themselves, even the most sophisticated transaction monitoring systems can at-times struggle to intervene. The payment looks legitimate because, from a technical standpoint, it is. The customer has been socially engineered into making it.
This is why the industry needs to evolve beyond transaction-level fraud detection to a more holistic approach that combines technology, education, and collaboration.
At Block, we take a three-layered approach to defense:
Technology That Works Behind the Scenes
Our real-time machine learning systems analyze patterns across millions of transactions to help spot potential scam activity. When our models detect warning signs, we surface in-app alerts that give customers a chance to pause before sending money. Every scam reported on Cash App makes our entire network smarter and more resilient.
Education That Empowers Customers
Consumer education plays an equally important role in our defense. That's why we partnered with the Financial Technology Association, PayPal, and Venmo to launch "Smarter Than Scams," a national consumer education campaign during the busy holiday season. The goal is simple: arm people with the knowledge they need to recognize red flags before they become victims. Because an informed customer is the strongest first line of defense.
Encouraging Reporting
The research reveals a critical insight: reporting works. People who report scams to their banks recover most or all of their funds 53% of the time, compared to just 12% who don't report at all. Yet nearly one-quarter of victims never report scams to their financial institutions, and one-quarter didn't even know they could. We're working to close that knowledge gap through clearer communication and accessible reporting channels, backed by our industry-leading reimbursement program.
But here's the reality that both Block and PayPal emphasized in the discussion: no company, no matter how sophisticated their technology or how comprehensive their education efforts, can solve this problem alone.
Scammers operate across platforms. They might recruit victims on social media, impersonate a bank via text message, and instruct the victim to send money through a payment app. They exploit the seams between platforms, knowing that information sharing is limited and defenses are fragmented.
The solution requires unprecedented collaboration:
The scam crisis demands an industry response, and the industry is rising to meet it. Through initiatives like Smarter Than Scams, AI-driven detection systems that improve with every reported incident, and cross-platform collaboration, we're building an ecosystem where people can transact with confidence.
At Block, we're committed to leading that effort alongside every partner, peer, and stakeholder who shares our mission to make the digital economy safer for everyone.
Scams have evolved into an industry. Combating them requires an equally sophisticated and coordinated industry response.
That's the key takeaway from a recent PYMNTS discussion featuring Brian Boates, chief risk officer at Block, Dave Szuchman, head of global financial crimes at PayPal, and Angelena Bradfield, head of policy at the Financial Technology Association. The conversation dove deeper into PYMNTS Intelligence research commissioned by Block, revealing both the scope of the challenge and the collaborative path forward.
The numbers are staggering. Nearly four in 10 U.S. households have been targeted by scams in the past five years. Americans lose billions of dollars annually to fraudsters who are becoming increasingly sophisticated, leveraging AI-generated voices, deepfakes, and social engineering tactics that exploit our most basic human instincts: trust, urgency and fear.
But scams aren't just a consumer problem or a single company's challenge. They're a systemic threat that demands a coordinated response across the entire financial services ecosystem.
As Brian Boates noted in the discussion, "When a lot of us think about the typical profile of a scam victim, we often think of elderly customers. But these days, it's not just older customers falling victim to scams, but it's also a lot of Gen Z and Millennial customers as well. Scammers don't discriminate."
This reality underscores why collaboration is essential. Scammers move across platforms and leverage any opportunities they find. That's why we need to work together by sharing intelligence, aligning on best practices, and building defenses that protect people no matter where they interact with the financial system.
The scam landscape has fundamentally changed. PYMNTS Intelligence research shows that more than two-thirds of victims authorize payments within 24 hours of first contact with a scammer, and nearly one in four send money within 30 minutes. In 81% of successful scams, criminals posed as trusted authorities, such as banks, government agencies, well-known companies, or even the victim's own contacts.
Traditional fraud prevention tools, built primarily to detect unauthorized transactions, weren't designed for this reality. When someone is tricked into authorizing a payment themselves, even the most sophisticated transaction monitoring systems can at-times struggle to intervene. The payment looks legitimate because, from a technical standpoint, it is. The customer has been socially engineered into making it.
This is why the industry needs to evolve beyond transaction-level fraud detection to a more holistic approach that combines technology, education, and collaboration.
At Block, we take a three-layered approach to defense:
Technology That Works Behind the Scenes
Our real-time machine learning systems analyze patterns across millions of transactions to help spot potential scam activity. When our models detect warning signs, we surface in-app alerts that give customers a chance to pause before sending money. Every scam reported on Cash App makes our entire network smarter and more resilient.
Education That Empowers Customers
Consumer education plays an equally important role in our defense. That's why we partnered with the Financial Technology Association, PayPal, and Venmo to launch "Smarter Than Scams," a national consumer education campaign during the busy holiday season. The goal is simple: arm people with the knowledge they need to recognize red flags before they become victims. Because an informed customer is the strongest first line of defense.
Encouraging Reporting
The research reveals a critical insight: reporting works. People who report scams to their banks recover most or all of their funds 53% of the time, compared to just 12% who don't report at all. Yet nearly one-quarter of victims never report scams to their financial institutions, and one-quarter didn't even know they could. We're working to close that knowledge gap through clearer communication and accessible reporting channels, backed by our industry-leading reimbursement program.
But here's the reality that both Block and PayPal emphasized in the discussion: no company, no matter how sophisticated their technology or how comprehensive their education efforts, can solve this problem alone.
Scammers operate across platforms. They might recruit victims on social media, impersonate a bank via text message, and instruct the victim to send money through a payment app. They exploit the seams between platforms, knowing that information sharing is limited and defenses are fragmented.
The solution requires unprecedented collaboration:
The scam crisis demands an industry response, and the industry is rising to meet it. Through initiatives like Smarter Than Scams, AI-driven detection systems that improve with every reported incident, and cross-platform collaboration, we're building an ecosystem where people can transact with confidence.
At Block, we're committed to leading that effort alongside every partner, peer, and stakeholder who shares our mission to make the digital economy safer for everyone.