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In the United States, federal prosecutors have turned their focus toward Block, a major player in the financial technology sector co-founded by Jack Dorsey, known for his involvement in Twitter.
This inquiry arises from revelations made by a former Block employee who submitted a substantial 100-page dossier. The documents reportedly detail alleged compliance shortcomings within Square and Cash App, both integral components of Block’s operations.
According to information provided to prosecutors from the Southern District of New York, the documents shine a light on what the former employee perceives as deficient customer data collection practices.
They suggest that Block facilitated numerous transactions involving countries subject to U.S. economic sanctions, such as Cuba, Iran, Russia, and Venezuela. Furthermore, the whistleblower alleges that Block processed cryptocurrency transactions for entities associated with terrorist organizations.
The individual behind the disclosures also claims that Block’s compliance infrastructure is fundamentally flawed, with individuals lacking the necessary qualifications to oversee a regulated compliance program. These allegations have sparked significant interest.
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Edward Siedle, a former Securities and Exchange Commission lawyer representing the whistleblower, implies that Block’s leadership and board were aware of these compliance issues in recent years. The former employee stated that from top to bottom, there are flaws in the compliance section, being led by individuals who are not suitable for managing a regulated compliance program.
Responding to these allegations, a spokesperson for Block reiterated the company’s commitment to maintaining a robust compliance program. They emphasized Block’s dedication to adjusting its compliance practices to mitigate emerging threats and adapt to evolving regulatory landscapes.