MONTGOMERY, Ala. (WDNews) — According to Alabama Attorney General Steve Marshall, the state will receive $595,421 as part of a $45 million multistate settlement with Block Inc., the company behind the Cash App peer-to-peer payment platform.
According to the attorney general’s office, the settlement resolves allegations that Block misled consumers about the safety of Cash App, failed to protect users from fraud and did not provide the fraud protections and resolutions required by law.
“We have long advised consumers to use caution when using peer-to-peer programs for payments. This settlement sends a clear message that companies offering these services must be transparent, secure, and accountable,” stated Attorney General Marshall. “Our office will continue to hold bad actors responsible and fight to ensure that consumers are protected in the digital marketplace.”
According to the release, Block told users their money was safe, implying the app provided protections similar to those offered by banks. Investigators alleged the company knew fraud on the platform was increasing but continued aggressive marketing rather than strengthening protections or warning users.
The attorney general’s office also alleged Block’s sign-up process required minimal identity verification, making it easier for fraudsters to create accounts. The company also lacked phone support for years, leaving users vulnerable to scammers posing as Cash App representatives through fake customer service phone numbers.
According to the investigation, Block also promoted a social media campaign known as “Cash App Fridays,” encouraging users to publicly share their $Cashtag for a chance to win prizes. Investigators said scammers used the promotion to target users by claiming they had won and convincing them to share login information.
The settlement also addresses customer service issues. According to the attorney general’s office, some users experienced account lockouts for suspicious transactions, while fraud victims often struggled to recover stolen funds because of delayed investigations and refunds.
Under the settlement, Block agreed to:
Maintain customer support to resolve fraud complaints, account lockouts and other issues.
Provide live customer support by phone and live chat.
Stop making false or misleading claims about Cash App’s safety.
End marketing practices that increase fraud risks.
Educate consumers about common fraud schemes.
Investigate fraud claims and reimburse users for unauthorized transactions as required by law.
According to the attorney general’s office, the settlement was led by Oregon and Texas and provides relief for consumers in all 46 participating states.
