Block, Inc. will pay $45 million to settle claims by 46 state attorneys general that Cash App users were promised bank-like safeguards while the company failed to deliver fraud protection and customer support required by law.
The bipartisan settlement, announced Wednesday by state attorneys general, targets how Block described Cash App’s security and how it handled users who said they had been scammed. The states said the company’s practices left consumers with few practical ways to recover stolen funds or challenge suspicious account activity.
New York Attorney General Letitia James said Block misrepresented Cash App’s safety, did not assist users after scams, and failed to provide fraud handling it had promised. Texas Attorney General Ken Paxton said weak verification, the lack of phone support for years, and misleading social media promotions gave scammers room to operate.
What the states said went wrong
Investigators said Cash App’s customer support gap became a fraud vector. Because the app did not provide a customer service phone number, users searched the web for help and found fake support lines run by scammers, according to James. She said Block knew users were being steered into those traps but did not warn them or create a real phone support line until 2021.
The states also pointed to signup rules that they said made abuse easier. Investigators found Cash App did not require users to provide a Social Security number or date of birth when opening an account. They also said there was no cap on the number of accounts one person could create, which allowed a bad actor to run many scam accounts at once.
Paxton said Cash App also delayed internal fraud reviews and locked accounts in ways that left victims unable to retrieve stolen money. Those are state allegations resolved by the settlement, not findings from a trial.
Money and required fixes
Texas will receive $5 million from the settlement, while New York will receive $1.6 million. The state-by-state distribution varies, with less populous states receiving under $1 million.
The New York consent judgment, like agreements in other states, requires Block to maintain 24-hour live customer support. At least 13.5 hours each day must be covered by a real person, according to the judgment.
The settlement also confirms Block’s obligations under a related January 2025 consent order from the Consumer Financial Protection Bureau. Under that federal order, Block is set to distribute between $75 million and $120 million to states, according to the state attorneys general.
Block and Cash App had not issued statements about the settlement as of Wednesday afternoon. Block, founded by Twitter co-founder Jack Dorsey in 2009, also owns Square payment technology and the music service Tidal.
This story draws on original reporting from The Record.
