Jack Dorsey’s Block Settles Cash App Fraud Claims with 46 States for $45m
A 46-state coalition led by Texas and Oregon states that the payments firm misled Cash App users and left them exposed to scammers.
July 9, 2026 – 2:18 pm
Image by: Mark Warner
Block, the payments company chaired by Jack Dorsey, has agreed to pay $45 million to settle claims from 46 US states that it mishandled fraud on Cash App, its money-transfer and digital-banking app.
This settlement is a sign of state regulators stepping into a void left by the Consumer Financial Protection Bureau (CFPB) under the Trump administration. According to court filings, Block was accused of:
- Telling customers that Cash App carried the security of a traditional bank and that their balances were FDIC-insured, when only partner banks would offer such protection.
- Lacking effective fraud-prevention procedures and often failing to investigate reports of unauthorized transactions.
One consistent theme throughout the case is the absence of a live customer support phone number until 2021, despite being aware of this gap since 2018. Scammers exploited this by setting up fake help lines to trick users into handing over account access.
Texas and Oregon led the investigation, and the $45 million will be divided among the participating states. Texas receives $5 million, Oregon $3 million, and New York roughly $1.6 million.
Block did not admit wrongdoing but agreed to the judgment "solely for the purpose of concluding this matter." A spokesperson described the case as a "previously disclosed legacy matter" and highlighted investments in consumer protection, customer service, and compliance for Cash App’s tens of millions of users.
The app has approximately 59 million active users, according to Forbes. This settlement should not be confused with earlier penalties. In January 2025, the CFPB ordered Block to pay $175 million over similar failures, including $120 million in customer redress and a $55 million fine.
The new court order reaffirms the $120 million redress obligation. State regulators have increasingly picked up the slack as the CFPB scaled back under the Biden administration.
Block’s regulatory bills have mounted over the past two years, facing scrutiny from various bodies, including fines of $80 million and $40 million related to anti-money-laundering shortcomings. As part of the new settlement, Block agreed to:
- Build a comprehensive compliance management system
- Stop overstating its fraud protections
- Maintain live phone support for at least 13.5 hours daily
- Respond to complaints about unauthorized transactions within three business days