The Consumer Financial Protection Bureau (CFPB) has ordered Block Inc., the operator of peer-to-peer payments app Cash App, to pay $175 million in refunds, compensation, and penalties for certain deficiencies.

The CFPB is also ordering Block to fix Cash App’s customer service and its processes for investigating disputed transactions, in part by setting up 24-hour, live-person customer service. The order requires Block to fully investigate unauthorized transactions and to provide timely refunds when appropriate.

Jack Dorsey’s Block Inc. will pay up to $175 million for failing to investigate and protect Cash App customers from fraudulent transactions under a settlement with the Consumer Financial Protection Bureau.

The Consumer Financial Protection Bureau on Thursday ordered payments firm Block to pay a penalty, citing fraud and weak security protocols on its mobile payment service Cash App.

Cash App's parent, Block Inc., settled two regulatory actions, one with the Consumer Financial Protection Bureau and another with state agencies.

Cash App-owner Block must offer up to $120 million in refunds to consumers who federal regulators say were exposed to potential fraud.

The Consumer Financial Protection Bureau (CFPB) on Thursday ordered payments firm Block to pay a penalty citing fraud and weak security protocols on its mobile payment service Cash App. The regulator said Block deprived Cash App users of meaningful and effective customer service and left the network vulnerable to criminals defrauding users.

Per the CFPB, Cash App's Terms of Service at one point claimed that any bank linked to an account for transferring funds was responsible for addressing disputes around fraudulent charges, something that's not generally true under the Electronic Fund Transfer Act.

Key Points ・Federal agency orders $175 million settlement for reported fraud and service failures ・Block, operator of Cash App, is required to overhaul security and refund consumers. ・Potential changes may affect how millions use popular peer-to-peer payment platforms.

Key Takeaways The Consumer Financial Protection Bureau has fined popular peer-to-peer payment platform Cash App for failing to protect customers from fraud and failing to investigate fraud complaints.

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 said.