The FTC is investigating whether Block broke consumer protection law by failing to offer Square users adequate support after freezing or shutting down their accounts, and it’s asking a federal judge in Oakland to make Block turn over documents.
The agency opened the probe last year after more than 1,500 complaints were submitted from users who said they couldn’t access up to $2.5M since 2022, even after answering Block’s bank and identity verification questions. The FTC’s filing also points to Block’s February plan to cut 4,000 jobs and lean on AI across its entire operation, which may have left Block without enough staff to help users locked out of their accounts.
Block said it’s cooperating with FTC staff on the agency’s few remaining requests and wants to bring the matter to a close.
Frankly, they should all be investigated for this — every last one of them.
Stripe. PayPal. Shopify. Amazon. eBay. They’ve all got blood on their hands.
In July, I reported that US Representatives Becca Balint (Vermont) and Nydia Velázquez (New York) introduced the Online Sellers Bill of Rights to help protect small businesses that have become dependent on platforms like Amazon and Walmart, which can cut off access to customers and income with little warning and no recourse.
I wrote at the time:
“They should extend the legislation to payment processors and e-commerce platforms like Stripe, PayPal, and Shopify — which also regularly freeze funds without much recourse. I’d also argue that the legislation should require that platforms offer a clear pathway to human support to appeal any suspension or termination decisions, and establish a penalty for the platforms that break the rules.”
We need clear-cut rules about what happens when an e-commerce platform, marketplace, or payment processor freezes, suspends, or terminates a seller’s account. So far the Online Sellers Bill of Rights hasn’t gone anywhere, and likely won’t during this administration, given that it’s backed by Democrats.
In the meantime, where are Block, Stripe, Shopify, and everyone else?
They seem to have time to design a protocol or develop open standards for everything else, but they can’t collectively agree on a basic process for resolving frozen accounts quickly and fairly? Is it really that difficult or costly to treat sellers with dignity and respect when they shut off access to their livelihoods?
It’s fucking bullshit, if you ask me. Do better.
