How Cash App Is Fighting Scams

The financial technology landscape has evolved dramatically, giving people access to more ways to exchange money and methods to communicate than ever before. While this innovation has created benefits to society, it has also fueled the rise of scams, especially through digital channels like social media, email, and communication platforms. Scammers have become increasingly skilled at targeting victims with sophisticated tactics.

Cash App's latest white paper explores the growing complexity of scams and highlights how companies like Block are proactively trying to address emerging risks. Tackling this challenge requires significant investment in advanced technology as well as collaboration across industries—government, law enforcement, financial services, and tech platforms—to disrupt scammers' evolving tactics effectively. Here’s what the paper highlights:

The Growing Complexity and Types of Scams

Scams have become increasingly complex given there is no universal framework for categorizing or addressing them across all platforms. We do know that scams follow a distinct life cycle, often beginning outside of payment apps, and has three phases:

• Connection
• Convincing
• Payment

Connection and Convincing often take place first on social media, via email or phone call, or some other form of interaction. The digital nature of communications has led to increased opportunities for scammers, as bad actors are becoming more sophisticated in identifying, engaging, and exploiting their victims.

Cash App’s Behavioral Insights team has categorized scams into two main groups: imposter scams and deception scams. Imposter scams involve pretending to be someone else, such as a business, government agency, or family member, to trick victims into sending money. Deception scams include tactics like goods and services scams, where victims pay for items they never receive, or romance scams, where trust is built before persuading victims to send money.

Increasing Digital Usage and Sophisticated Scam Techniques

As people spend more time online, their potential exposure to fraud increases. The increasing use of social media to buy, sell, and promote products has enabled more scams to take place.

We often think of scams impacting older Americans more, but scams have greatly impacted younger generations who spend more time online, especially across social platforms. Nearly 40% of 2021 fraud loss reports by Gen Z and younger Millennials originated on social media.

Scammers are blending technological, psychological, and operational strategies to exploit victims. The rise in AI has led to tools that scammers can use to generate convincing deep fakes, while using large language models (LLMs) to optimize email phishing.

Together, these trends pose a significant challenge for those working to combat these threats.

How Cash App Combats Scams

For our current 57 million monthly active customers, our first line of defense is to make our platform as resilient against scams as possible. We know that scammers are also resilient, so we’ve built our own protections across the platform to detect and prevent scams, secure customer accounts, take action against scammers, and educate and protect customers as new scams emerge. These actions include:

• Investing in scam prevention awareness and education through marketing and social media platforms
• Surfacing useful contextual information on each customer's profile to help customers identify and avoid scams
• Using advanced technology such as AI to detect and block bad activity
• Leveraging our internal team of experts to review customer accounts as well as customer reported scams in order to remove bad actors from the platform
• Creating and maintaining continuous feedback loops that connect customer reported scams as well as the outcomes from internal investigations to how we train and update our scam detection models.

Building a United Front Against Scams

As digital scams grow more complex and sophisticated, no single company can combat this threat alone. The path forward requires strong partnerships between government, law enforcement, financial services, telecommunications, social media, and technology platforms. Cash App has invested heavily in this collective work — partnering with others across industries and the public sector to develop best practices, improve information sharing, and disrupt scams before they impact individuals. What we recommend:

1. Educate and empower individuals: Beyond platform measures, raising public awareness is essential to reducing scam vulnerability.
2. Formalize information sharing: Establish a cross-industry coalition to share real-time threat intelligence and best practices.
3. Strengthen law enforcement resources: Equip law enforcement with the funding and tools needed to investigate complex scams, prosecute major crime rings, and address smaller-scale frauds that disproportionately impact individuals.

Together, through transparent collaboration, education, and resource-sharing, there can be a safer digital world, empowering and protecting individuals with resilience and trust across platforms.