Dive Brief:

• Block agreed Wednesday to pay $45 million to 46 states to resolve allegations that it misled consumers about the safety of its peer-to-peer financial tool Cash App and didn’t offer users fraud protections.
• Under the terms of the multistate settlement, Block will implement customer support processes to resolve fraud complaints and account lockouts, along with having a human available via phone at least 13 ½ hours per day and live chat open at least 18 hours daily.
• The settlement resolves a “legacy matter that primarily relates to historical aspects of our business,” Block said Wednesday in an emailed statement. Cash App has made “significant investments in consumer protection, customer service, and compliance,” the company added.

Dive Insight:

Oregon and Texas led the states’ investigation of Cash App, which has about 59 million active monthly users. Each of the states filed the proposed settlement in state court for approval.

“The company failed to help people when things went wrong,” the Oregon Department of Justice said Wednesday in a press release. 

In its statement, Oakland, California-based Block said that it shares “the commitment of the attorneys general to addressing industry challenges” and will continue investing in Cash App “to promote a safe and healthy financial ecosystem.”

The states also alleged that a Block social media campaign, Cash App Fridays, exposed people to fraud by encouraging users to post their “$cashtag,” a Cash App user name, on social media to win a weekly prize. Fraud actors would then contact the users to tell them they’d won and persuade them to turn over their login information.

“Block knew about these scams and kept running the promotion anyway, for years,” the states said in a press release that multiple states issued Wednesday.

“CashApp knew peer-to-peer payment apps were prime targets for fraudsters, and instead of taking extra steps to safeguard their platform, they misled and deceived consumers about protections being offered,” Pennsylvania Attorney General Dave Sunday said in his press release.

The settlement follows an agreement by Block to pay $255 million to 48 states and the Consumer Financial Protection Bureau in January 2025 related to fraud committed via the app and Block’s compliance measures.

The states said their settlement also affirmed Block’s commitment to pay at least $75 million in redress to consumers nationwide as part of the CFPB settlement negotiated during the Biden administration. That settlement stipulated that Block would distribute at least $75 million, and as much as $120 million, to consumers.

Subsequently, the Trump administration has sought to reduce the bureau’s mission and to close it. 

The CFPB under Acting Director Russell Vought “has cancelled several settlements, including at least two in which restitution had not yet been paid,” Oregon noted in its press release about the Cash App settlement. (Last month, President Donald Trump nominated a former CFPB deputy director, Brian Johnson, to lead the agency.)

“Consequently, the multistate agreement ensures that if Block fails to pay the restitution it promised under the 2025 CFPB settlement, that obligation will be absorbed into Oregon’s settlement and enforced by the multistate executive committee,” the states said.

Separately, Cash App agreed Tuesday to pay $20 million to Washington state to resolve a 2020 investigation into the company’s role in moving at least $22 million in state unemployment benefits through Cash App accounts. Those funds were obtained during the COVID-19 pandemic from fraudulent applications, regulators said.

Hawaii, Missouri, South Carolina and Wyoming weren’t listed as participating in the settlement.