PROSPER, TX —
Attorney General Ken Paxton said Texas has secured a $45 million multistate settlement with Block, Inc., the operator of the Cash App payment platform, resolving allegations that the company misled consumers about the safety of its service and failed to protect users from fraud.
The investigation, which Texas co-led alongside 45 other states, found that Cash App marketed itself as a safe, bank-like place to keep money while fraud on the platform rose sharply and its consumer protections failed to keep pace with the broader banking industry.
Lax identity-verification standards, a years-long absence of phone support, and social-media promotions left users exposed to scammers, according to the attorney general's office.
When Texans trust a financial platform with their paychecks, savings, and family's security, they deserve to be fully protected as promised. I will make sure that they are.
Paxton said the settlement ensures that Texans who were harmed can recover what they are owed. Under the agreement, Block must maintain 24-hour customer support, stop making misleading safety claims, discontinue marketing practices known to increase fraud, and fulfill its legal duty to investigate and reimburse users for certain unauthorized transactions. Texas will receive nearly $5 million of the $45 million total.
Cash App allows users to transfer money to one another and for years promoted direct deposit of paychecks and government benefits into the app, a practice that specifically targeted consumers who came to rely on it as their primary financial account. Prosper, in Collin and Denton counties north of Dallas, has grown rapidly to roughly 40,000 residents.
Sources
https://www.texasattorneygeneral.gov/news/releases/attorney-general-ken-paxton-secures-45-million-settlement-cash-app-victims-exposed-fraud-and
