Cash App’s parent company, Block, has agreed to pay a nine-figure fine of up to $120 million to settle allegations that it failed to combat fraud on its platform. The Consumer Financial Protection Bureau (CFPB) ordered Block to return the funds to users and pay a $55 million fine for failing to investigate customer complaints about hijacked accounts and unauthorized charges.
The CFPB accused Cash App of not providing an in-person helpline, instead offering a useless phone number that directed customers back to the app for assistance. This decision allegedly led to problems that scammers exploited, including fake websites created by scammers posing as Cash App customer service representatives.
The agency claims Block knew about these fake numbers but didn’t alert customers until 2020. The lack of a working phone number also made it difficult for identity theft victims who needed to contact the company when a fraudster set up an account in their name.
As part of the settlement, Block will be required to establish a 24-hour live-person customer service system. CFPB Director Rohit Chopra stated that Cash App created conditions for fraud to proliferate on its platform and failed to take responsibility when things went wrong.
Source: https://finance.yahoo.com/news/how-a-useless-customer-service-number-got-cash-app-in-big-trouble-with-regulators-215619767.html