Market Chatter: Block Under Probe for Alleged Compliance Malpractices
10:46:23 AM ET, 05/01/2024 - MT Newswires
10:46 AM EDT, 05/01/2024 (MT Newswires) -- Block (SQ) is said to be under probe for alleged compliance lapses at its Square and Cash App units, NBC News reported Wednesday, citing two unnamed sources familiar with the matter.
NBC said prosecutors from the Southern District of New York are looking into the company's documents and internal practices after a former employee disclosed certain malpractices within the group. According to the former employee, Block collected insufficient information for Square and Cash App customers' risk assessment, Square processed thousands of transactions involving countries with economic sanctions, and Block processed cryptocurrency transactions for terrorist groups.
The former employee provided about 100 pages of supporting documents to NBC and said Block did not correct the processes when informed of the transactions, the report added. NBC said a second source familiar with the company's practices and monitoring programs backed the former employee's allegations.
According to NBC, a Block spokeswoman said the company voluntarily reported the transactions described by the former employee to the Office of Foreign Assets Control under the US Treasury and that the company maintains a "responsible and extensive compliance program."
Block did not immediately respond to MT Newswires' request for comment.
(Market Chatter news is derived from conversations with market professionals globally. This information is believed to be from reliable sources but may include rumor and speculation. Accuracy is not guaranteed.)
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