Block, Inc. agreed to a $40 million settlement with the New York State Department of Financial Services (NYDFS), a “significant failure” of its anti-money laundering compliance program, Wall Street Regulators announced Thursday.
The company led by Jack Dorsey has agreed to maintain an independent monitor after violating departmental money transfer machines and cryptocurrency rules, NYDFS added.
NYDFS discovered that the block’s company had “inadequate customer due diligence” and failed to implement enough systems to prevent money laundering and illegal activities.
The NYDFS said Block’s services were “vulnerable to criminal exploitation” and argued that Block’s “slow treatment” for Bitcoin transactions allowed largely anonymous transactions to avoid scrutiny.
“Compliance functions must respond to the growth or expansion of the company,” NYDFS Principal Adrienne A. Harris said in a statement.
What is called BitheiceseBlock’s cash app has been regulated as a cryptocurrency business under the NYDFS since 2018.
Last year, Cash App Ended Support for free peer-to-peer (P2P) Bitcoin payments is leaning towards other cryptocurrency services users have been attracting.
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