Cash App owner Block to pay $175M over fraud caused by lax consumer protection practices

Block, the owner of Cash App and Square, will pay $175 million to settle allegations that its lax consumer protection practices put customers at high risk of fraud, the Consumer Financial Protection Bureau (CFPB) said Thursday.

Banks, credit unions, and other financial institutions are subject to oversight by federal agencies, to ensure they follow rules intended to prevent fraud and lead to fairness for customers, investors, and competitors.

Payment apps have surged in popularity and, until recently, received little oversight because agencies weren’t clear whether and how existing rules could be applied to these novel entities. Payment apps now process over 13 billion transactions annually.