Block Will Pay $45 Million to Settle 46-State Cash App Fraud Protection Probe

Block has agreed to pay $45 million to settle allegations from 46 states that Cash App misled users about fraud protection and did not provide the fraud resolution required by law. For high-risk payments operators, the point is straightforward: if your product sits in the money movement stack, consumer protection promises are not marketing copy.

1. The investigation was led by Oregon and Texas, according to the Oregon Department of Justice. The states said Block falsely implied that Cash App offered the same protections as a bank, while requiring only minimal identity verification to sign up made it easier for fraudsters to open accounts.
2. The states also alleged that Cash App had no phone support for years, failed to warn users that scammers were posting fake numbers and posing as Cash App, and kept running a social media promotion that Block knew fraudsters were using to trick users into handing over login information.
3. Under the settlement, Block must maintain customer support that can resolve problems, offer live phone support 24 hours a day, stop making false or misleading claims about Cash App’s safety and fraud protections, discontinue marketing practices known to increase fraud, educate consumers about fraud, and fulfill its legal obligations to investigate fraud claims and reimburse users for unauthorized transactions.
4. Oregon Attorney General Dan Rayfield said: “Cash App told people their money was safe, and millions of Oregonians and Americans believed them, including a lot of people who didn’t have other options. When things went wrong, Block left them with nowhere to turn.” Texas Attorney General Ken Paxton said Texans who trust a financial platform with their paychecks, savings and family’s security deserve to be fully protected as promised.
5. Block said in an emailed statement to PYMNTS that the multistate settlement “resolves a previously disclosed legacy matter that primarily relates to historical aspects of our business.” The company added that Cash App has made “significant investments” in consumer protection, customer service and compliance to serve the “tens of millions of Americans” who rely on it for banking and credit needs.

The Oregon Department of Justice said the multistate settlement also ensures that Block will pay the restitution included in a January 2025 settlement with the U.S. Consumer Financial Protection Bureau (CFPB). That CFPB deal involved similar conduct and called for restitution to consumers nationwide of between $75 million and $120 million.