Earlier this year, Kik Messenger user “usasexguide” was selling a stash of videos he’d amassed of child sexual abuse. One customer, who said he was a 35-year-old father of two, offered to buy 200 videos for $45. “How do I pay?” he asked.
“Cash App,” heyyyydude1 responded, sending over his payment details and a code for a Cash App referral fee. With each transaction, and many more disturbing videos sent, the seller was unknowingly providing a pile of evidence to an undercover agent with the Immigration and Customs Enforcement’s child exploitation unit. That’s according to government investigators, who claimed that after Cash App and Kik data was subpoenaed, heyyyydude1’s real name and address were revealed to be 33-year-old Philadelphia resident Michael Wilcox. Indicted in April, he awaits trial. His counsel declined to comment.
Current and former police, as well as nonprofits working directly with cops to fight child exploitation, say that such crimes are often happening via Cash App, which brings in billions in gross profit every year for Block, Inc., the Jack Dorsey-run payments giant formerly known as Square. They say that whether it’s to pay for sex with a minor, to send children funds in return for nude images or to traffic a young adult victim, Cash App is often the payment tool of choice. Block says it does not tolerate crime on its technologies and that the company proactively scans transactions for suspicious signals that could indicate criminality, but the claims of illicit use of Cash App are supported by police department data and dozens of cases reviewed by Forbes in which the tool was used to facilitate sex crimes.
Joe Scaramucci, a detective who set up the human trafficking unit for the McLennan County Sheriff’s Office in Waco, Texas, says that in his experience, outside of physical cash, Block’s tech is the primary payment tool used by people selling sex, whether they’re trafficking adults or children. Searching a police database of sex ads for “CashApp” in Waco returned 2,200 ads, compared to 1,150 for PayPal and 725 for Venmo, a PayPal-owned rival, according to data provided by Scaramucci. Similar data put together by the Arizona attorney general shows that between 2016 and 2021, there were 480,000 online sex ads where Cash App was listed as a form of payment, nearly double that of nearest rival Venmo at 260,000. For sex traders, “Cash App is king,” Scaramucci said.
Current and former employees are now raising concerns about the company’s investment in keeping Cash App clean, and critics are sounding the alarm over what they claim is Block’s lax monitoring and reporting of myriad criminal behaviors on its popular payment tool. Though it recently launched a Cash App for Teens feature, the company is conspicuously absent from collaborative efforts to fight abuse, failing to provide any tips to the National Center for Missing and Exploited Children (NCMEC), America’s national clearing house for sexual abuse material found on tech platforms. Its primary rival PayPal, the owner of Venmo, has contributed tips to the nonprofit.
Does Cash App have the appropriate level of staff to deal with this?”
Cash App’s detractors claim criminals are attracted to its lack of thorough identity checks as compared to traditional banks and the ability for those who have abused the app to quickly sign up again. “We’re definitely seeing an escalation of the use of Cash App for a number of reasons. One is that its due diligence is next to none,” says Colm Gannon, a former sex crimes investigator in New Zealand and cofounder of Pathfinder, a police contractor focused on online child abuse.
There’s also the lure of apparent anonymity offered by Cash App, says ex-Arizona attorney general human trafficking investigator Chad Brink. Users only need to reveal their profile name, called a “cashtag,” to receive and send funds. Because it’s possible to shift funds so quickly between accounts—one signal of criminality that Block’s algorithms could detect and flag as suspicious—it’s easier to hide and cash out ill-gotten gains, added Brink. He complained about delays to getting responses from Cash App, taking far longer than rivals, leading him to question whether or not Block has invested in legal compliance in line with its explosive growth. “Does Cash App have the appropriate level of staff to deal with this?” he asked.
Block spokesperson Danika Owsley said that all forms of human trafficking were not permitted on Cash App. She added that the company operated “in line with applicable laws and regulations,” closing accounts and reporting suspicious transactions to police, while working voluntarily with nonprofits, industry and law enforcement.
“We do not tolerate illegal activity on Cash App. We maintain robust compliance programs and continuously assess and enhance our systems and controls to prevent, detect and report bad activity on the platform,” she added.
Launched in 2013 by Block, Cash App quickly became a cash cow for Dorsey, helping him amass a fortune of $4 billion. Competing with PayPal, Venmo and Zelle, it rapidly gained market share by offering a quick, simple and free alternative.
With Block’s market cap currently at $30 billion six years after its IPO, much of its growth is due to Cash App, which makes revenue by charging a small fee for business use, and through its stock trading and cryptocurrency exchange features. In its latest quarterly results, Dorsey’s business revealed that this June, 47 million accounts carried out transactions on Cash App. The business generated gross profit of $705 million in the most recent quarter, up from $624 million in the preceding quarter, accounting for nearly half of Block’s total $1.5 billion in Q2.
But as Cash App has grown in revenue and popularity, so has its use in sex crimes. Hundreds of pages of court filings describe cases where law enforcement said Cash App was used to either pay for sexualized images or sex with minors and adults. Among the filings referencing Cash App were multiple instances where a victim was trafficked on Skipthegames.com, one of the largest sex advertisement websites. That included one recently unsealed investigation where a victim in Grand Rapids, Michigan, was just 17 years old. A search for “Cash App” and “CashApp” on Skipthegames.com collectively returned nearly 900,000 results, compared to 470,000 PayPal and a similar number for Venmo.
In one of the more egregious recent cases, a 26-year-old Asheville, North Carolina, man enticed 15 minor females into either sending him sexually explicit images or having sex with him, typically sending the victim hundreds of dollars over Block’s app. He was sentenced to 28 years in prison. And in another recently unsealed warrant, an FBI agent said the agency had raided the Cash App data of an individual who was suspected of trafficking a 15-year-old runaway in San Diego.
The highest-profile case involving Cash App and alleged sex crimes, though, revolves around Florida Rep. Matt Gaetz. The Justice Department is reportedly investigating whether the Congressman paid to have sex with various women, including a 17-year-old girl. Last year, the New York Times reported that it had reviewed receipts from Cash App and Apple Pay showing payments from Gaetz and an associate—indicted Florida tax official Joel Greenberg—to one of the women. (Gaetz has previously denied any wrongdoing. His spokesman, Joel Valdez, said, “It must be a slow day for Forbes to be covering an 18-month-old debunked news story. We usually don’t comment on those.” Greenberg’s counsel did not respond to a request for comment. He’d previously pleaded guilty to identity theft and sex trafficking of a 17-year-old. )
The cases show how vital Cash App data can be when piecing together evidence of a crime, definitively proving how and when illegal content or services were bought. Cash App is often ordered to hand over user information via search warrants, subpoenas and other court orders, and it has regularly provided data, whether it’s a customer’s name, payment details, geolocation or IP addresses used to access the tool, according to case files reviewed by Forbes. Cash App spokesperson Owsley said the company had a dedicated law enforcement response team to provide information in compliance with local, state and federal laws.
Yet response times can vary. Scaramucci said the last time he filed a request for Cash App data in December 2021, he got it back within 12 days. But Brink claimed the company has become increasingly slow to respond to such requests. He said Cash App often took longer than 30 days to respond, while PayPal and Venmo were much more responsive. “As the Cash App business has grown, there has been significant investment of resources in our compliance organization across all areas of the team and levels of leadership,” Block spokesperson Owsley said in response.
Even though Cash App will turn user data over to the cops, the app is designed so that anyone selling or trading sex can remain anonymous from other users. In a recent post on the USASexGuide.nl forum, a significant resource for people buying and selling sex, a user claimed many sex workers moved to Cash App as a form of protection, having previously been robbed of hard cash. Digital money, in such inherently dangerous situations, was seen as safer than the analog equivalent.
