Cash App users who received unsolicited text messages may now be eligible for a substantial financial settlement following a class-action lawsuit that alleged violations of telemarketing laws. The settlement, totaling $12.5 million, allows eligible recipients to claim up to 147 individual checks as part of the resolution. This development stems from claims that the popular mobile payment service engaged in or facilitated spammy marketing practices through text communications, leading to potential violations of the Telephone Consumer Protection Act (TCPA). The settlement’s approval by a federal court has opened the door for affected users to seek restitution, with the possibility of receiving multiple payments depending on their claim submissions. This move highlights increasing scrutiny of digital communication practices by financial service providers and underscores the importance of consumer rights in the age of digital payments and messaging.
Background of the Settlement and Allegations
Legal Claims and Court Proceedings
The class-action lawsuit, filed in 2022, accused Square, Inc. (the parent company of Cash App) of violating federal telemarketing laws by sending unsolicited text messages to potential and existing customers without proper consent. The plaintiffs alleged that these messages were used to promote various financial products and services, often leading to consumer complaints about spam and privacy violations. According to court documents, the plaintiffs argued that these communications constituted a breach of the Telephone Consumer Protection Act (TCPA), which restricts automated telemarketing calls and texts.
Legal proceedings culminated in a settlement agreement approved by a federal judge in late 2023. The agreement stipulates that Cash App will pay out a total of $12.5 million to resolve all claims, with funds allocated for individual claims, legal fees, and administrative costs. The settlement also includes provisions for improved communication practices to prevent future violations.
How the Settlement Benefits Eligible Users
Eligibility Criteria and Claim Process
To be eligible, Cash App users must have received one or more unsolicited text messages promoting services or offers from the platform between January 2021 and December 2022. Participants do not need to prove harm or damages but must submit a claim form to verify their eligibility.
| Number of Checks | Approximate Payment Range |
|---|---|
| 1–10 | $25–$200 |
| 11–50 | $200–$600 |
| 51–147 | $600–$1,500 |
Participants can claim multiple checks based on the number of messages they received, with a maximum of 147 checks per individual. The settlement administrator emphasizes that payments will be distributed based on the number of valid claims submitted and the total number of eligible users.
Steps to File a Claim
- Visit the official settlement website provided by the court or settlement administrator.
- Complete the online claim form, providing details about the number of unsolicited texts received and the dates.
- Submit supporting documentation if required (such as screenshots or records of received messages).
- Wait for confirmation of eligibility and payout details.
Claims must be submitted by the deadline, which is set for March 31, 2024. Payments are expected to be distributed via prepaid debit cards or direct deposit, depending on the claimant’s preferences and location.
Implications for Digital Communications and Consumer Protections
Industry-Wide Impact
This settlement underscores the increasing regulatory focus on how financial technology companies manage customer communications. While SMS marketing remains a vital tool for engagement, companies face mounting pressure to ensure compliance with laws designed to protect consumers from unwanted solicitations. The case against Cash App is seen as part of broader efforts to enforce telemarketing rules within the rapidly evolving fintech landscape.
Consumer Rights and Future Practices
Legal experts point out that the settlement serves as a reminder for companies to implement strict opt-in procedures and transparent communication policies. Consumers are encouraged to review their privacy settings and opt-out options regularly to avoid unwanted messages and ensure their rights are protected. The case also highlights the importance of consumers being vigilant about unsolicited texts and understanding their eligibility for compensation when violations occur.
Additional Resources and Information
- FTC official settlement page
- Telephone Consumer Protection Act (TCPA)
- Forbes article on fintech marketing compliance
Consumers who believe they are eligible are advised to act promptly, as the window for submitting claims is limited. This case illustrates ongoing efforts by regulators to uphold consumer rights amid the proliferation of digital marketing and messaging tactics in the financial sector.
Frequently Asked Questions
Who is eligible to receive checks from the Cash App texting settlement?
Eligible Cash App users who were affected by the texting practices are entitled to receive up to 147 checks following the $12.5 million settlement.
How many checks can eligible users potentially receive?
Eligible users may receive up to 147 individual checks as part of the settlement distribution.
What is the total settlement amount related to the Cash App texting case?
The total settlement amount is $12.5 million, which will be distributed among eligible users.
How can eligible users claim their checks from the settlement?
Eligible users should follow the official settlement website instructions to verify their eligibility and claim their checks.
When will the checks be distributed to eligible Cash App users?
The distribution timeline is typically communicated by the settlement administrators; users should monitor official updates for specific release dates.
