According to the lawsuit, throughout the Class Period, defendants made false and misleading statements and/or failed to disclose that:
- Block had engaged in widespread and years-long compliance lapses at Square and Cash App, including by failing to conduct basic due diligence regarding its customers’ identities or the nature of customer transactions so as to prevent the platforms from being used for illegal or illicit activities;
- Block had effectively created a haven for widespread illegal and illicit activities on its Square and Cash App platforms by imposing minimal obligations on customers seeking to open accounts, transact, and deposit or withdraw funds; encouraging the use of bitcoin; and pressuring Block’s banking partners to forgo ordinary know your customer due diligence activities;
- thousands of transactions on Square and Cash App were made in connection with a wide variety of illegal and illicit activities, including, inter alia, money laundering, child sexual abuse, sex trafficking, drug trafficking, terrorism financing, contract killings, and illicit payments to entities and persons subject to economic sanctions;
- Block allowed its customers to withdraw funds even after the accounts had been flagged for potentially illegal or illicit activities;
- Block customers could open up multiple accounts using fake identities in order to engage in illegal or illicit activities;
- Block’s senior leadership and the Board of Directors had failed to correct identified compliance deficiencies despite numerous red flags, internal employee reports of deficiencies, and customer complaints;
- Block’s Cash App user metrics had been artificially inflated through the use of fake accounts and the ability of criminals and other bad actors to open multiple accounts; and
- as a result of the above, Block was subject to a material, undisclosed risk of its conduct being exposed, thereby exposing Block to reputational harm, adverse regulatory actions, the loss of business activity, and adverse impacts to Block’s operations and financial results.
No Class Has Been Certified. Until a class is certified, you are not represented by counsel unless you retain one. You may select counsel of your choice. You may also remain an absent class member and do nothing at this point. An investor’s ability to share in any potential future recovery is not dependent upon serving as lead plaintiff.
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