Cash App users are now eligible to seek reimbursement from a $15 million settlement following allegations that the company failed to implement sufficient security measures to protect user data. The plaintiffs claimed that Block and Cash App Investing were negligent in securing customer accounts, which led to unauthorized access, fraudulent transactions, and data breaches. While the companies deny any wrongdoing, they chose to settle to avoid the expenses and risks associated with prolonged litigation.
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Eligible customers who experienced fraudulent transactions, unauthorized access, or unsatisfactory responses to their complaints between August 23, 2018, and August 20, 2024, may claim up to $2,500 in reimbursement for out-of-pocket losses, as well as additional compensation for time lost and transaction-related damages. The settlement also includes those who faced security breaches or poor customer service handling. Claims must be submitted by the deadline of November 18, 2024, and more information on how to file is available on the official settlement website.
Cash App Class Action Lawsuit
This settlement arises from a consolidated class action lawsuit filed by plaintiffs Michelle Salinas, Raymel Washington, and Amanda Gordon against Block, Inc. (formerly Square), and its subsidiary, Cash App Investing. The legal action followed allegations that a former employee of Cash App improperly accessed user account data in 2022, and additional unauthorized access occurred in 2023, primarily involving the reuse of phone numbers. The plaintiffs accused Block and Cash App Investing of negligence in their security protocols, alleging that the companies failed to implement necessary measures to safeguard user data, resulting in unauthorized transactions and inadequate responses to customer complaints.
While Block and Cash App Investing have denied any wrongdoing or liability, they opted to settle the case to avoid lengthy legal battles and the uncertainty that could arise from prolonged litigation. The settlement offers financial compensation and other remedial actions aimed at addressing the concerns raised by the plaintiffs, including enhancing security measures to prevent future breaches. This resolution underscores the increasing scrutiny on tech companies and financial platforms regarding the protection of sensitive customer data, particularly in the face of growing incidents of data misuse and security lapses in the digital finance sector.
Allegations of Security Breaches And Issues
The lawsuit brought against Cash App highlighted multiple security incidents:
- 2022 Security Breach: A former employee of Cash App gained unauthorized access to sensitive customer data, leading to a significant data breach. This breach exposed the personal information of numerous users, including financial details, which were allegedly misused.
- 2023 Security Issues: In a separate incident, Cash App faced vulnerabilities that allowed unauthorized users to access accounts by exploiting recycled phone numbers, further compromising user security.
The plaintiffs argue that these security lapses were indicative of Cash App’s failure to maintain adequate cybersecurity measures and to swiftly address customer complaints regarding unauthorized transactions. They allege that the company’s negligence in safeguarding personal data and resolving issues promptly resulted in significant financial losses, emotional distress, and inconvenience for affected customers.
Settlement Goals And Objectives
The primary objective of the settlement is to provide financial compensation to affected users while ensuring the implementation of robust security measures to prevent future breaches. This agreement aims to address the harm caused to users and restore trust, while also committing to improved data protection protocols moving forward. Additionally, the settlement resolves the issue efficiently without the need for protracted litigation, thereby saving both plaintiffs and the defendant from extensive legal costs, time delays, and the unpredictability of a court trial. The resolution aims for a fair outcome, protecting the rights of affected individuals while ensuring accountability and corporate responsibility.
Who Is Eligible?
You are considered a member of the Settlement Class if you:
- Are a current or former customer of Cash App and/or Cash App Investing, its affiliates, parents, or subsidiaries.
- Had your personal information, Cash App account, or Cash App Investing account accessed or obtained without authorization, whether through a data breach, hacking incident, or other unauthorized access?
- Experienced unauthorized or fraudulent transactions, including withdrawals or transfers of funds, to or from your Cash App or Cash App Investing account, or had errors related to such transactions that were not properly resolved, between August 23, 2018, and August 20, 2024.
- Had issues with Cash App’s security protocols or encountered unresolved errors that caused financial losses, including but not limited to transaction disputes, unauthorized fund transfers, or account access problems that were not appropriately addressed during the relevant period.
Understanding Compensation
The settlement offers different types of compensation to class members to address various damages resulting from the alleged security failures.
Monetary Compensation
A total of $15 million has been set aside in the Settlement Fund, which will be distributed as follows:
- Payment for attorneys’ fees and legal expenses.
- Service awards to the class representatives.
- Costs associated with administering the settlement.
- Direct payments to class members who submit valid and timely claims.
Compensation Guidelines For Security Incident Impact:
- Out-of-Pocket Losses: Eligible claimants can receive compensation of up to $2,500 for expenses directly related to security incidents. This can include costs such as credit monitoring services, identity theft protection, credit freezes, replacement of payment cards, and any bank fees incurred, such as overdraft charges, if not reimbursed by the bank or financial institution.
- Lost Time: Claimants are entitled to reimbursement for up to three hours of lost time spent addressing the consequences of security breaches, paid at a rate of $25 per hour. This covers activities such as contacting financial institutions, securing personal accounts, or other necessary actions to resolve the incident.
- Transaction Losses: Individuals may be compensated for documented financial losses that directly stem from unauthorized activities on their accounts. This includes monetary losses that have not already been covered by services such as Cash App, insurance providers, or other financial institutions.
Pro-Rata Distribution
If the total amount of valid claims exceeds the available Net Settlement Amount, payments to each claimant will be adjusted proportionally, ensuring an equitable distribution of funds. On the other hand, if the claims are less than the available amount, any surplus funds will either be redistributed among the claimants in proportion to their original claims or, if deemed appropriate, donated to a designated charity or organization. The exact allocation method will depend on the circumstances and the guidelines outlined in the settlement agreement.
Process of Claim For Cash App Settlement
To benefit from the settlement, eligible class members must submit a claim form by the deadline of November 18, 2024. The claim process is designed to be simple and accessible both online and through paper submissions for those who prefer to mail their forms. To ensure your claim is considered, it is crucial to provide all necessary supporting documentation, such as receipts, police reports, or other evidence demonstrating the losses and efforts made to resolve them.
Steps to File a Claim:
- Confirm Eligibility: Carefully review the settlement terms to ensure you meet the eligibility criteria.
- Collect Documentation: Gather all relevant documents to support your claim, including financial records, receipts, and any official reports or correspondence that verify the losses and your attempts to resolve them.
- Complete the Claim Form: Fill out the Claim Form accurately, attach all required documentation, and submit it either online or by mail before the deadline.
Ensure your submission is complete and timely to maximize your chance of benefiting from the settlement.
More Information And Asset
For further assistance or to request additional details about the settlement, claimants can reach out to the Cash App Security Settlement Administrator via the official phone number or mailing address provided. Claimants need to update their contact information promptly if it changes after submitting a claim. This ensures they receive any eligible payments or updates related to the settlement.
This settlement represents a pivotal step in addressing the alleged security vulnerabilities associated with Cash App. It offers affected users a structured process to claim financial compensation while highlighting the critical importance of strong security protocols and responsive customer support in the digital payments industry.
FAQs
Q1: What is this settlement about?
Ans: It resolves claims of unauthorized transactions or privacy violations by Cash App.
Q2: What documents are needed?
Ans: Proof of transactions or issues related to your claim.