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The Federal Trade Commission is looking into whether Block Inc. stopped short of assisting Cash App users whose accounts had been frozen or deactivated, Bloomberg reported Thursday.
Block, the parent company of the point-of-sale technology platform Square and the financial technology Cash App, froze or deactivated Square accounts holding funds totaling as much as $2.5 million in actions taken since 2022, according to an FTC petition reported by Bloomberg.
Block responded to Bloomberg’s reporting about the frozen accounts, noting it is working with the FTC “in good faith…to bring about the closure of this matter.” The company did not immediately respond to questions from Digital Transactions News.
The FTC as part of its investigation noted Block’s news earlier this year that it would reduce staff by some 4,000 positions in response to the company’s adoption of artificial-intelligence technology, Bloomberg reported, adding that significant sections of the court documents filed so far remain redacted.
At the time of the staff reductions, Jack Dorsey, Block’s founder and chief executive, explained the action as entirely related to AI efficiencies rather than a result of financial woes.
In related news, the payout platform MassPay announced Thursday an integration with Cash App that will enable payments directly to Cash App accounts belonging to gig workers, contractors, marketplace sellers, and other users as a payout option. The transfers occur in near real time “for a fee,” MassPay said, though it did not specify the charge.
