Utah receives settlement in Cash App fraud case

The Utah Department of Commerce's Division of Consumer Protection, represented by the Office of the Utah Attorney General, has announced a $45 million multistate settlement with Block Inc., the company behind the popular peer-to-peer payments app Cash App.

The settlement resolves allegations that Block misled consumers about the safety of Cash App, failed to protect users from fraud on the platform, and didn't provide the fraud protection and resolution that it promised, which was required by law. In short, the company failed to help people when things went wrong.

The state of Utah will receive $482,183 in the settlement with Block.

"This settlement marks a pivotal step in safeguarding Utah consumers. Block prioritized rapid expansion over essential security and customer support. It lured consumers with false promises of safety and preyed on vulnerable, low-income families who relied on Cash App for their financial stability, leaving them exposed to fraud without recourse," said Katie Hass, director of the Division of Consumer Protection, in a department release. "By enforcing rigorous new standards for fraud protection, live customer support and honest marketing, we are holding the company accountable and ensuring that Utahns finally have the reliable, protected financial services they were promised."

Block told Cash App users their money was safe, implying that the app worked like a bank, with the same protections. At the same time, Block knew fraud on its platform was rising sharply, and instead of warning users or strengthening protections, it doubled down on marketing.

The department said that for years, Block actively promoted direct deposits of paychecks and government benefits into Cash App. It made a particular push to reach unbanked and underbanked consumers, people who would often rely on Cash App as their primary financial account, and who were especially vulnerable to fraud. Block grew its user base without making sure it could support those users when problems arose, the department said.

Block's policies didn't just fail to stop fraud. According to the department, in several ways, they made it easier:

Block's sign-up process was designed to be fast and frictionless, with minimal identity verification. That made it easy for fraudsters to create accounts, not just legitimate users.

For years, Cash App had no phone support. Users who needed help could message only through the app or on social media. People who got locked out — or just wanted to talk to someone — searched online for a phone number and often ended up calling fake 1-800 numbers run by scammers posing as Cash App. Those scammers would then take over accounts or drain users' other financial accounts. Block knew this was happening and didn't warn users or set up a real phone line until years later.

Block ran a social media promotion called Cash App Fridays, encouraging users to publicly post their $cashtag — a unique Cash App identifier — for a chance to win a weekly prize. Fraudsters would then contact those users, tell them they had won, and trick them into handing over their login information. Block knew about these scams and kept running the promotion anyway, for years.

The department release said Block's failure to fulfill its promise to protect users from fraud had real consequences for real people. Innocent users who experience automated account locks for suspicious transactions were frequently locked out of their accounts for weeks without a way to access their money. Victims of fraud through the app were often left with no recourse, because delays made it impossible to get stolen money back from scammers, and because Block failed to investigate unauthorized transactions and failed to issue refunds when required by law.

Under the settlement, Block has agreed to implement and maintain responsible practices to resolve these issues, including maintaining customer support to resolve fraud complaints, account lockouts and other issues; offering live support 24 hours a day, with a human available by phone at least 13.5 hours a day and by live chat at least 18 hours a day; stopping false or misleading claims about Cash App's safety and fraud protections; discontinuing marketing practices known to increase fraud on the platform; educating consumers directly about common types of fraud; and fulfilling its legal obligations to investigate fraud claims and reimburse users for unauthorized transactions.

Oregon and Texas led the investigation, securing relief for all 46 participating states. In Utah, the Division of Consumer Protection thanked the Office of the Attorney General, including Public Protection Deputy Attorney General Douglas Crapo and Assistant Attorney General Peishen Zhou, for their work on the settlement.