Product: Money transfer, virtual currency, or money service

Today, the Consumer Financial Protection Bureau ( CFPB ) ordered Block, the operator of the peer-to-peer payments app Cash App, to refund and pay other redress to consumers up to {$120.00} XXXX and pay a penalty of {$55.00} XXXX into the CFPBs victims relief fund. Block employed weak security protocols for Cash App and put its users at risk. While Block is required by law to investigate and resolve disputes about unauthorized transactions, the companys investigations were woefully incomplete. Block directed users who had suffered financial losses as a result of fraud to ask their bank to attempt to reverse transactions, which Block would subsequently deny. Block also deployed a range of tactics to suppress Cash App users from seeking help, reducing its own costs. 

Cash App created the conditions for fraud to proliferate on its popular payment platform, said CFPB XXXX XXXX XXXX. When things went wrong, Cash App flouted its responsibilities and even burdened local banks with problems that the company caused.

Block, Inc. ( NYSE : SQ ) is a publicly traded corporation whose principal executive offices are in XXXX, California. Block offers multiple digital payments products for businesses and consumers, including the point-of-sale payment system Square and the consumer payment service Cash App. Cash App is one of the largest peer-to-peer payment platforms in the United States, with XXXX XXXX XXXX XXXX accounts. It allows consumers to send and receive electronic money transfers ; accept direct deposits ; and use a prepaid card, Cash Card, to make purchases and ATM withdrawals. Block made approximately {$7.00} XXXX in gross profit in 2023, approximately {$4.00} XXXX of which was generated by Cash App. 

Cash App attempted to avoid many of its investigative obligations through tricking consumers with its Terms of Service. For example, many Cash App users link their bank account to the app. When a transaction occurs, the money is pulled from the users bank account and sent to the transaction recipient. In Cash Apps Terms of Service, consumers are led to believe that disputes are the responsibility of their linked bank. The Electronic Fund Transfer Act generally requires that peer-to-peer platforms, including Cash App, investigate disputes of unauthorized transactions, and a company can not simply use fine print to escape these legal requirements. When it did conduct investigations, Block used intentionally shoddy investigation practices to close reports of unauthorized transactions in the companys favor.

Block also deprived Cash App users of meaningful and effective customer service and left the network vulnerable to criminals defrauding users. While Block included a telephone number on the back of its Cash Card and in its Cash App Terms of Service, for many years this telephone number did not connect consumers to customer support of any type. Instead, it led to a pre-recorded message directing consumers to contact customer support through the app. Consumers could only contact Block through the app or through U.S. mail and were often met with delayed, inadequate, confusing, or inaccurate responses. Consumers looking for an alternate route to Cash App customer service through web searches were targeted by fraudsters posing as Cash App representatives, who tricked them into giving up their passwords and other personal information. Block knew that its customers were being targeted by fraudsters in this way but failed to take timely action to address the issue.