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Block is under compliance investigation for allegedly processing transactions for sanctioned countries and terrorist organizations

Block is under compliance investigation for allegedly processing transactions for sanctioned countries and terrorist organizations

CointimeCointime2024/05/02 03:07
By:Cointime

Jack Dorsey, co-founder of Twitter (now renamed X), and his financial technology company, Block, are under investigation by federal prosecutors. A former employee provided internal documents to the prosecutor for the Southern District of New York, revealing long-standing and widespread compliance issues with Block's Square and Cash App businesses. These issues include: inadequate collection of customer information to evaluate risk; Square processing thousands of transactions involving countries under economic sanctions; Block processing multiple cryptocurrency transactions for terrorist organizations; and failure to accurately report most suspicious transactions involving credit cards, US dollars, and Bitcoin to the government. When Block received alerts for non-compliance, the company did not correct its processes. The documents show that last year's transactions involved entities from countries under US economic sanctions (Cuba, Iran, Russia, and Venezuela), many of which were for small amounts. When asked about the investigation, a Block spokesperson issued the following statement: "Block has a responsible and comprehensive compliance plan and regularly adjusts our practices to address new threats and constantly changing sanctions regulatory environments. Our compliance plan includes systems, tools, and processes for sanction screening, as well as investigating and reporting sanction issues in accordance with our regulatory obligations. Continuously improving the security of the ecosystem is Block's top priority. We have been and will continue to invest heavily in our compliance plan based on this work." (NBC)

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