What Is an Authorized Push Payment (APP) Scam and How Does It Work?

There are so many ways to pay for goods and services now. You don’t even need cards or cash – you can send money directly to other people or businesses from your bank account or other payment platforms using phone apps and computers. Unfortunately, all of these new technologies give scammers more ways to operate, and one of their favorite techniques in recent times is the authorized push payment scam, or APP scam.

How Do Authorized Push Payment Scams Work?

A push payment is one in which the person paying is in charge of every aspect of the transaction. They initiate the transfer and can set the amount and time/date on which the money moves, unlike a “pull” payment, in which the recipient can initiate a payment request and has some level of control over how and when the money comes through.

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People make APPs every day to pay for various services, and scammers can use that to their advantage. They use APP scams to trick their victims into making push payments directly to scammer accounts. Authorized push payment scams can take a wide range of forms, like:

Product/Service Purchases: The victim thinks they’re sending money in exchange for a product or service, but the product/service never actually materializes.
Investment: Scammers encourage victims to invest funds in their sites, schemes, or ventures, but disappear with all the money they receive.
Romance/Catfishing: Fraudsters use dating apps and platforms to initiate romantic relationships with their victims before asking them to send money to help with living costs or buy them gifts.
Advance Fees: Scammers claim that a victim has to pay an advance or admin fee to receive some benefit or service, which could be anything from loan forgiveness to a contest cash prize.
Impersonations: The scammer pretends to be someone official – a lawyer or police officer –and demands the victim pays them, often with some sort of threat if they fail to pay.

While the nature of each APP scam varies, they all tend to follow the same basic idea – the scammer uses various means to trick their victim into making a push payment to one of their accounts.

Red Flags You Shouldn’t Ignore

Demands for Up-Front Payment

Scammers usually don’t have any real goods or services to offer in return for your money, which is why they demand you pay first and then get your product or reward after. Be wary of any individual or business – especially those you don’t know much about – demanding you pay in advance for something or pay some sort of admin or processing fee before getting a service.

Pressure, Threatening Language, or Scare Tactics

Scammers are often impatient and target multiple people simultaneously. They try to get as much out of each individual and as quickly as they can before moving to the next target. They’ll use threatening language, coercive techniques, blackmail, and other scare tactics to pressure you into paying up. Authentic businesses and trustworthy people won’t resort to such tactics.

“Too Good to Be True” Claims

Many scams work because they prey on vulnerable people and promise them things that could change or improve their lives significantly. It might be a loan you need to cover important costs, a cash prize, or a fancy product at a fraction of the usual price. Unfortunately, when something seems too good to be true, it’s often a lie.

How to Protect Yourself from APP Scams

Don’t respond to unsolicited requests for payment.
Refuse to pay any advance fees for services.
Always verify the identity of anyone asking you to pay them.
Research brands or people you’re unfamiliar with before paying them.

Report the Scam

You can report suspected APP scams in several ways:

Report to the FTC.
Report to the FBI Internet Complaints Center.
It’s also a good idea to report scammers to your bank or payment provider if you’ve already made a payment, as they may be able to recover your funds.