According to an NBC report on Wednesday, former Twitter CEO Jack Dorsey’s startup, Block, is under investigation by the US government. Federal prosecutors are working with informants to investigate the compliance practices of Block’s cryptocurrencycurrency section, Square, and Cash App.
According to a former Block employee, “thousands” of questionable transactions were made without being notified to the US Office of Foreign Assets Control, or OFAC, which levies financial penalties. The individual asserts, “Everything in the compliance section was flawed from the ground up.”
Due to inadequate sources and checks, the company that Jack Dorsey co-founded is accused of facilitating bitcoin transactions linked to terrorist organizations and sanctioned countries. But in spite of its allegedly lax cryptocurrencycurrency standards, the article claims that Block’s Square and Cash App businesses have “widespread and yearslong compliance lapses” that go considerably deeper.
Ex-employees supplied over 100 pages of purportedly internal company documents to the publication, including information on correspondence between the Block and sanctioned countries including Russia and Iran as recently as last year.
In a statement, Block the firm stated that it already does routine sanctions screenings on all of its merchants and that independent attorneys, advisors, and its in-house legal team are “advis[ing] on the issue and appropriate remediation.”
The correspondence trail backs up claims that even when Block discovered that sanctioned organizations were abusing its services, it continued to facilitate transactions with them. Block said that it did not purposefully violate any international laws.
Read also: FBI Urges Public to Avoid Unlicensed Crypto Transfer Services
