The investigation centered on lax account creation standards, which allowed users to open profiles without verifying a Social Security number or date of birth. Regulators argued this lack of oversight created an environment where scammers could operate unchecked. Furthermore, the absence of an official customer support line pushed desperate users toward fraudulent third-party numbers, compounding their financial losses.
In section Startups & Technology
Block to pay $45 million over Cash App security failures
Cash App operator Block has agreed to a $45 million settlement with 46 U.S. states following allegations that the platform left users vulnerable to rampant fraud. State attorneys general claimed the company misled customers about its security protocols while failing to provide adequate support when scams occurred.
Block maintains that it did not engage in any wrongdoing despite the payout. As part of the agreement, the company must overhaul its fraud prevention measures and implement live customer support. This settlement follows a broader crackdown on fintech practices, including a separate $175 million action by the Consumer Financial Protection Bureau regarding similar failures to investigate fraud claims.
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