Consumer complaint received 2025-12-09 00:00:00
Product: Money transfer, virtual currency, or money service — Mobile or digital wallet
Issue: Unauthorized transactions or other transaction problem — 
Company: Block, Inc.
State: PA

Complaint narrative:
I am filing a formal complaint against Block Inc, the parent company of Cash App. Their conduct in this matter suggests a pattern of deceptive practices, failure to provide required error resolution procedures, and possible attempts to retain consumer funds in dormant accounts for unjust enrichment. 

Transaction ID : XXXX My Cash App username : XXXX A {$550.00} payment was sent to a Cash App account tied to an old phone number ( Recipient Account : XXXX ), for services already rendered by the intended recipient. The intended recipient can not access that account. They no longer use the phone number and they never used email with Cash App. Cash App has no traditional identity verification methods for basic consumer accounts, so if a user changes a phone number, they effectively lose access to their entire Cash App account, their stored value, and all future payments that go into that account. These funds fall into a XXXX hole with no practical path for recovery. Cash App knows this. It is a known design flaw, and they choose not to fix it. 

I, the sender, requested a refund using the in app option. Cash App rejected that request even though the recipient account was dormant. A dormant account with no activity should automatically trigger a return of funds under any reasonable standard. I then filed a dispute through the app. I selected the exact, correct dispute reason which states that the recipient can not access the account. Instead of resolving the dispute, Cash App issued an irrelevant denial claiming that my account was not compromised. That was never the issue. This response ignored the dispute reason I selected and pretended I chose something else. This is deceptive and appears designed to trap funds in inaccessible accounts. Additionally, the denial took several days, even though it was clear that no human looked at it, indicating that Cash App also purposefully slows automated resolutions for several days, where the outcome is a denial, to make the appearance it has conducted an investigation with human intervention when it clearly does not.

Under Regulation E ( Electronic Fund Transfer Act, 12 CFR Part 1005 ), Cash App is required to conduct a reasonable investigation and resolve errors in good faith. This includes payments sent to the wrong or inaccessible recipient. They must respond accurately and must not rely on canned replies that mischaracterize the nature of the dispute. Their denial violates the requirement to conduct a reasonable investigation. It also violates 1005.11, which requires financial service providers to correct errors promptly when evidence shows the consumer did not receive the benefit of the transfer. Additionally, delaying revealing what is an instant, algorithm-based denial decision by several days to consumers to give the false impression of a human investigation is an amplification of their Reg E violation, and a violation in and of itself.

Under the Consumer Financial Protection Act of 2010 ( 12 U.S.C. 5531 and 5536 ), financial service providers are prohibited from engaging in unfair, deceptive, or abusive acts or practices. Rejecting disputes by using false reasoning, refusing to consider the actual dispute reason selected, and trapping money in accounts that the intended recipient can not access is deceptive and unfair. It also creates a significant risk of financial harm to consumers and provides no reasonable consumer benefit. 

Despite this being a basic and very common scenario, and Cash App 's published reliance on automated and algorithm based dispute resolution, Cash App did not provide any competent automated resolution, which is the minimum expected given their user base and the frequency of this issue. Instead, I had to spend approximately two hours calling support on multiple occasions. I was not allowed to speak to the disputes department directly. I was not allowed to speak to a supervisor. At one point, I did a three way call with the intended recipient and watched them spend more than one hour speaking with Cash App support with no resolution. Cash App turned a simple and ordinary problem into a nightmare for both parties. 

The pattern is clear. Cash App has the technical ability to automate resolutions for this type of issue, even a low-tech company would. Cash App is a XXXX XXXX XXXX company who has invested substantial amounts in automated processes, so them not covering this common scenario with any automated ( or non-automated ) resolution mechanism, is certainly not unintentional. They chose not to. They denied the dispute using reasoning that did not match what I submitted. They refused to acknowledge the correct dispute reason. They ignored the fact that the account is dormant and inaccessible. They also rejected the initial refund request, which should have been instantly approved for a dormant account. Taken together, these actions indicate an attempt to retain funds that belong to consumers. This is not an isolated mistake. It shows a systemic strategy of wrongfully keeping money that falls into dormant or unreachable accounts. 

Cash App can not plausibly claim that they are unable to reverse a payment when the recipient account has not been accessed and the recipient could not possibly have seen the transaction. This is the equivalent of a tree falling in the woods with no one there to witness it, so clawback should be a simple and straightforward process. Cash App knows the funds are unclaimed, they know the intended recipient can not access the account, and they still refuse to return the money. 

Because of Cash Apps behavior, I ultimately had to pay the recipient twice. The first payment vanished into a XXXX hole Cash App created. 

I have * not * filed a dispute with my bank account where Cash App took the money for this transfer, because that would be a violation of my agreement with Cash App. I play by the rules. Cash App does not. 

I request that the CFPB require Block Inc to : XXXX. Immediately return the funds to the sender for transaction XXXX because the receiving account is dormant and inaccessible. 
XXXX. Correct their error resolution process so that disputes based on inaccessible or dormant accounts are resolved consistent with Regulation XXXX. 
XXXX. Stop using misleading reasoning in dispute denials and stop issuing responses that do not match the dispute reason selected by the consumer. 
XXXX. Explain why refund requests are not automatically honored when the recipient account shows no recent activity. 
XXXX. Address whether their system design, combined with their dispute handling practices, results in unjust enrichment by trapping consumer funds in accounts that no longer belong to accessible users. 
XXXX. Implement real and reliable methods of identity verification so that users do not permanently lose access to their money simply by changing phone numbers.

7. Stop withholding automated denials of claims for days to create the illusion of a human investigation.

Cash Apps handling of this matter violates the Electronic Fund Transfer Act, Regulation E, and the Consumer Financial Protection Act. Their actions harm consumers, mislead users, and appear to allow Block Inc to financially benefit from inaccessible funds. This situation requires regulatory intervention. 

Thank you for your attention.

Company response to consumer: Closed with explanation