Maryland to receive $1.6 million in settlement with Cash App parent company

BALTIMORE -- Block, Inc., the parent company of Cash App, has agreed to pay $80 million in a settlement with Maryland and 47 other states over violations of bank secrecy and anti-money laundering laws, Maryland Department of Labor's Office of Financial Regulation said Tuesday.

Maryland will receive approximately $1.6 million from the settlement, which addresses compliance failures in Block's mobile payment service used by more than 50 million U.S. consumers.

"Mobile payment apps have become an inextricable part of our economy," Maryland Secretary of Labor Portia Wu said. "It is essential that we prevent bad actors from misusing payment services to commit fraud."

State regulators found Block failed to meet certain requirements for customer due diligence, suspicious activity reporting, and controls for high-risk accounts, potentially leaving its services vulnerable to illegal activities.

"Maryland will not tolerate poor compliance with critical safeguards," Commissioner of Financial Regulation Tony Salazar said.

The settlement also requires Block to hire an independent consultant to review its compliance program and submit a report within nine months. The company will then have 12 months to address any identified deficiencies.