Cash App is one of the largest peer-to-peer payment platroms with more than 56 million accounts. Similar to Zelle and Venmo, Cash App enables its customers to send money electronically. Recently the Consumer Financial Protection Bureau (CFPB) ordered Block, Cash App’s parent company to pay $120 million in refunds to its customers who had been defrauded while using the app and another $55 million to the CFPB’s victims relief fund. The basis for the order was Cash App’s failure to use sufficient security protocols to protect their customers from being scammed.
According to the CFPB, Cash App failed to properly investigate and resolve disputes about unauthorized transactions in violation of its obligations under federal law. Specifically, the CFPB said that CAsh App used intentionally shoddy investigation practices to cloe reports of unauthorized transactions int he company’s favor. Cash App included a telephone number on the back of its Cash Card and in its Cash App Terms of Service that for many years did not connect customers to any kind of customer support, but instead led to a pre-recorded message directing customers to contact customer support through the app. Customers attempting to contact Cash App through the app or mail were met with inadequate, confusing or inaccurate responses. If customers did a web search for a customer service number, they often found phony customer service information sites created by scammers who tricked customers into giving up their passwords or other personal information thereby giving the scammers access to their victims’ bank accounts tied to their Cash App accounts. According to the CFPB, Cash App knew its customers were being scammed in this manner, but neglected to act appropriately to address this problem.
TIPS
If you were a customer of Cash App who had lost money to a scammer and your case was not properly investigated by Cash App and were not reimbursed for your loss, you do not need to take any action at this time to receive your refund. The CFPB will be enforcing its order to ensure you get your refund. As more information becomes available about the refunds, I will let you know.
In regard to many of the scams affecting customers of Cash App, particularly where they were tricked into providing their passwords, these scams could have been avoided by using dual factor authentication for their account.
How to Enable 2FA on Cash App:
- Open Cash App on your device.
- Tap the profile icon (top right corner).
- Select Privacy & Security.
- Look for Two-Factor Authentication and toggle it on.
- Choose an authentication app (e.g., Google Authenticator) and follow the setup instructions.
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