States win $45 million settlement over Cash App fraud claims
Cash App users were told their money was as safe as a bank’s, but 46 states said Block lacked real fraud defenses and phone support.
State attorneys general secured a $45 million settlement with Block on July 8 after accusing the company of misleading Cash App users into believing their money carried bank-like protections and advanced fraud detection that were not actually there. Oregon led the multistate investigation, and the deal brought together 46 attorneys general.
The gap between Cash App’s marketing and its safeguards hit hardest for people who used the app as a primary financial account. Block had pushed direct deposits of paychecks and government benefits into Cash App, especially to unbanked and underbanked consumers. California said the company implied FDIC-style protections and told customers their money was as safe as in a bank. New York said Block lacked a consistent fraud detection system and did not have a functioning fraud hotline. Nebraska said Cash App had no phone support for years, and that scammers used fake support numbers to drain users’ accounts. Nebraska also said Cash App Fridays were exploited by fraudsters who tricked users into handing over login information.
Under the settlement, Block must stop misleading marketing, give users access to live customer service agents and make changes meant to protect users from fraud. California said its share of the deal is $2.9 million, New York said it will receive $1.6 million in penalties, Nebraska said its share is $379,619.99 and Pennsylvania said it will receive more than $1.1 million. California also said the settlement blocks Block from evading up to $120 million in consumer redress tied to a separate federal case.
That federal case dates to January 16, 2025, when the Consumer Financial Protection Bureau ordered Block to pay up to $120 million in redress and a $55 million civil penalty, for a total federal action worth up to $175 million. Cash App payments are being made as part of the CFPB settlement, and the federal agreement concerns historical customer-service issues from July 1, 2019, through January 16, 2025.
Block reported 57 million monthly transacting actives in 2024 and $283 billion in Cash App inflows that year. The settlement now forces Block to rewrite how it markets Cash App and how quickly users can reach a real person when money disappears.
This article was produced by Prism’s automated news system from verified source data, official records, and press releases, then run through automated quality and moderation checks before publishing. The system is built and supervised by the people who set the standards it runs under. Read our full AI policy.
Did this article answer your question?
