Block Inc. agrees to multi-state payout after security failures exposed users to scammers
The parent company of Cash App is forking over $45 million to resolve claims that it downplayed security risks and left users vulnerable to fraud. State attorneys general from 46 states announced the bipartisan settlement with Block, Inc. on Wednesday, accusing the fintech giant of promising protections it never delivered.
New York Attorney General Letitia James was blunt: the company “failed to help users when they were scammed, misled consumers about the safety of Cash App, and failed to provide the fraud protection and resolution that it promised and was required to provide by law.”
Texas will receive $5 million from the settlement. New York gets $1.6 million. Smaller states are collecting less than $1 million each.
What investigators found: no phone support, fake numbers, and unlimited accounts
The probe uncovered a cascade of basic failures. Cash App didn’t offer a phone number for customer support — so users searched online and wound up calling scammers who had set up fake helplines. Block knew this was happening, James said, but didn’t warn customers or launch a real phone line until 2021.
Signing up required no Social Security number or date of birth. There was no cap on how many accounts one person could open. That allowed a single bad actor to run a whole network of scam accounts, investigators concluded.
Texas Attorney General Ken Paxton described the situation bluntly: “Lax verification standards, a years-long absence of phone support, and deceptive social media promotions left users exposed to scammers.” He added that Cash App dragged its feet on internal fraud investigations and locked victims out of accounts with no way to recover stolen money.
The settlement requires real human support — at least 13.5 hours a day
The consent judgment filed in New York, mirroring those in other states, forces Block to maintain live customer support 24 hours a day. At least 13.5 hours of that must be staffed by “a real person.” That’s a direct response to years of complaints about automated, unhelpful responses.
This agreement also reaffirms a separate federal consent order from January 2025. Under that deal with the Consumer Financial Protection Bureau, Block must distribute between $75 million and $120 million to states. Combined, the two settlements push Block’s total payout over $120 million.
Block stays silent — and faces a credibility problem
As of Wednesday afternoon, neither Block nor Cash App had issued a statement about the settlement. That silence speaks volumes for a company that once built its brand on simplicity and trust.
Founded by Jack Dorsey in 2009, Block also owns the payment platform Square and the music streaming service Tidal. The company has long positioned itself as an alternative to traditional banking. But this settlement suggests its security and customer service fell short of even basic expectations.
What Cash App users should know now
If you use Cash App, a few things are worth keeping in mind:
- Verify support channels. Only use the official app or website for help. Don’t Google a customer service number — scammers still run fake ones.
- Watch for account limits. The settlement doesn’t change the fact that Cash App lacks FDIC insurance on most balances. Your money isn’t protected the way it would be in a bank.
- Report fraud quickly. Block is now required to respond faster to fraud claims. If you’re scammed, document everything and file a report through the app immediately.
The broader lesson? A sleek interface and a famous founder don’t guarantee security. The Cash App settlement is a reminder that when fintech companies cut corners on support and verification, users pay the price.
