Connecticut Department of Banking Joins Other State Regulators in Issuing Regulatory Action Against Block, Inc., Cash App for BSA/AML Violations

January 15, 2025

Connecticut Department of Banking Joins Other State Regulators in Issuing Regulatory Action Against Block, Inc., Cash App for BSA/AML Violations

HARTFORD - The Connecticut Department of Banking joined 48 other state financial regulators in a coordinated enforcement action in which Block, Inc. will pay a $80 million fine to be shared across the participating states with approximately $1.6 million coming to Connecticut which will be deposited into the general fund. They will undertake corrective action for violations of the Bank Secrecy Act (BSA) and anti-money laundering (AML) laws that safeguard the financial system from illicit use.

More than 50 million consumers use Cash App, Block's mobile payment service, to spend, send, store, and invest money.

"I am grateful for the work of my fellow regulators who took the lead in this enforcement action" said Banking Commissioner Jorge Perez. "This action underscores the importance of state financial regulators in not only protecting consumers but ensuring the integrity of the financial system as a whole. As these types of financial services continue to become more widespread, the Department stands ready to enforce our laws and ensure that terrorists and other bad actors do no gain access to our financial system."

In the multistate settlement signed this week, Block agreed to pay the assessed penalty to the state agencies, hire an independent consultant to review the comprehensiveness and effectiveness of its BSA/AML program, and submit a report to the states within nine months. Block then will have 12 months to correct any deficiencies found in the review after the report is filed.

State regulators in Arkansas, California, Massachusetts, Florida, Maine, Texas, and Washington State led the multistate enforcement effort. Block cooperated with the states in the settlement.

Under BSA/AML rules, financial services firms are required to perform due diligence on customers, including verifying customer identities, reporting suspicious activity, and applying appropriate controls for high-risk accounts. State regulators found Block was not in compliance with certain requirements, creating the potential that its services could be used to support money laundering, terrorism financing, or other illegal activities.

Through a strong, nationwide regulatory framework, state financial regulators license and serve as the primary supervisor of money transmitters. Collectively, states license more than 700 money transmitters, and 99% of transmission activity through those firms is governed by the state-developed Money Transmission Modernization Act. The Department licenses over 200 money transmitters here in Connecticut. To protect consumers and enforce safety and soundness requirements, state regulators regularly coordinate supervision of multistate firms and, when necessary, initiate enforcement actions. This coordination - Networked Supervision - supports consistency and collaboration, while preserving the authority of individual states to take direct action.

State financial regulators license and supervise more than 34,000 nonbank financial services companies through the National Multi-State Licensing System (NMLS), including mortgage companies, money services businesses, consumer finance providers, and debt collectors. The Department of Banking, through its Consumer Credit Division, licenses and supervises more than 12,800 companies, branch offices, and individuals.

Consumers who have questions about the settlement should contact The Connecticut Department of Banking. Consumers can also visit NMLS Consumer Access to verify that a company is licensed to do business in Connecticut, and they may also view past enforcement actions.

For more information, refer to the background document on the enforcement action.

Media Contacts

Department of Banking:
Matt Smith
[email protected]
203-996-1241 (cell)