A 'click-to-cancel' subscription rule

Here are three of the week's top pieces of financial insight, gathered from around the web:

Buying a home in the layoff era

Contingencies are back in the home buying process, said Veronica Dagher in The Wall Street Journal. During the housing-market frenzy of 2020 through 2022, many buyers felt pressured to waive standard contingencies like financing and even home inspections "to compete with those making cash offers." Now, though, "53 percent of real estate agents report an increase in contingencies." Among the more popular provisions getting added is an employment contingency, which hasn't been this popular since the 2008 financial crisis. In general, employment contingencies are written into the offer to state that if buyers lose their job before the closing, "they can back out of the deal" without losing their deposit.

Dorsey's Cash App under fire

Shares of Twitter founder Jack Dorsey's payment app Block, formerly known as Square, plunged last week after an influential short seller said the company "highly" inflates its user base, said Rohan Goswami and ­MacKenzie Sigalos at CNBC. A two-year investigation by Hindenburg Research revealed last week how Block's money-sharing platform, Cash App, "thrived on serving 'unbanked' customers" and enabled fraud to "run rampant." The short seller easily opened accounts in the names of former President Donald Trump and Elon Musk, and received physical "cash cards" in the mail bearing their names. "Former employees estimated that 40 percent to 75 percent of accounts they reviewed were fake." Many of these fraud accounts received government stimulus payments during the pandemic through Cash App, "with no bank account needed."

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A 'click-to-cancel' subscription rule

If you know the frustration of being automatically entered into a costly membership "after trying something for free," regulators want to make your life easier, said Michelle Singletary in The Washington Post. The difficulty of canceling free and discount offers led to 17,000 Federal Trade Commission complaints last year. To cut down on ­"telephone-hell loops," the FTC is proposing a rule that would require an easy "click to cancel" ­option on the phone and online. The goal is to avoid more auto-renewal nightmares like that experienced by customers of a learning app called ­ABCmouse, which paid a $10 million settlement for sneakily auto-renewing ­subscriptions — and then refusing to take cancellation requests by phone or email.

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