Cash App Owner Hit With Over $100M Fine For Fraud And Customer Service Issues

The U.S. Consumer Financial Protection Bureau is ordering Block, Inc., the parent company of Cash App, to pay up to $120 million to consumers and $55 in civil penalties for unfair and deceptive practices for customers.

The CFPB found that Block, which is owned by Twitter founder, Jack Dorsey, failed to give adequate customer service–including the absence of live telephone agents–for customers to get help for issues with the app.

Block is a financial services company that operates payment apps, Cash App and Square, layaway payments platform, Afterpay, and music streamer, Tidal.

The failure allowed fraudsters to seize the opportunity and create fraudulent customer service lines to access compromised users' information.

CFPB alleged that Block mishandled fraud detection and resolution of unauthorized transactions, violating the Consumer Financial Protection Act and Electronic Fund Transfer Act.

Block blamed the issues on "unprecedented growth" during the pandemic.

"Over the past several years, we've made significant investments in customer support and resolving concerns more efficiently, in addition to combating scams," the company said after reaching the agreement with regulators.

"While we strongly disagree with the CFPB's mischaracterizations, we made the decision to settle this matter in the interest of putting it behind us and focusing on what's best for our customers and our business."

The company says it now has multiple ways for customers to contact them directly, including live phone support.