Cash App is facing a class action lawsuit following the 2021 incident. when a former employee accessed the database and leaked user information in the United States. A court settlement was reached, accepting compensation from the company. It is estimated that payments will occur before the end of 2025 with figures up to $2,500 per affected.
Cash App
Cash App was launched in 2013 by Block, Inc., as a digital wallet for US customers. It is a digital platform that works with a P2P method (peer to peer), and allows you to save money, send it immediately, invest, borrow or access the credit card. Its appeal is its real-time function that reflects the movements and balance in real time.
How does it work?
Transactions through the Cash App platform are characterized by having P2P method singularities.
Some of them are:
- Can be done through platforms such as Cash App, Apple Pay, Venmo, PayPal and Zelle.
- Payments do not require a business account
- You can link either a credit card, debit or bank account.
- Its design and interfaces are easy and intuitive for smartphones.
- Funds are available immediately and in real time.
- Transactions are free of charge, except for those that are subject to commercial transaction fees or credit card financing.
Mobile payment applications are designed for the user and transactions can be bi-directional as anyone can sign up. It is also valid for use by companies, which must have a business account if they want to accept payments from customers in this way.
What happened in 2021?
In December 2021, a former Cash App employee accessed the company’s database, leaking information about users. This event ended up with a class action lawsuit by those affected that reached a total of $15 million. The latest news states that affected users will receive compensation for damages and for being victims of the leak. Individual figures will be up to $2,500.
Despite the fact that Cash App denies having committed any kind of security negligence, they have faced a class action lawsuit for negligence and breach of security obligations, which has ended up settling for $15 million in damages.
There were 8.2 million affected users who were informed about the leak caused by a former employee of the company. On January 13, 2025 the court ruled that those affected should receive compensation of up to $2,500.
Economic impact on Cash App
The claims in the application were filed between 23 August 2018 and 20 August 2024. The deadline for filing a claim is 18 November 2024. It was not enough to claim and join the legal demand, but users had to justify and meet a some requirements, such as:
- Have detected between 23 August 2018 and 20 August 2024, transfers or withdrawals of money in the account, or any other type of fraudulent activity.
- The individual must be a customer of this digital platform prior to the incident, and must have been a user of the cash or investment application.
- There must be a record of access to the account without the holder’s authorization.
For what matters could I receive compensation?
The claimants in this class action suit meet all of the requirements specified above. All of them suffered anomalies in the period between August 2018 and August 2024. The claim is for compensation from Cash App for security negligence and damages. It has been determined by court that all those users who experienced any kind of inconvenience related to the failure to correct errors related to the incident, and those who suffered financial losses due to unauthorized activities in their accounts will be compensated up to $2,500.
Payments are expected to start before the end of 2025. In addition, additional compensation may also be claimed for any loss of an unauthorized transaction. At $25 per hour, they can also request a refund for the lost time that the app was out of service.
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