Block Inc. negotiating settlement with NYDFS over alleged compliance deficiencies

Block Inc. would be in talks with New York regulators to settle concerns about its bitcoin and compliance programs.

In his last 10-k classification form With the American Commission for Securities and Exchange, the Jack Dorsey-The dark company said that it “continued negotiations” with the New York State Financial Services Department on “aspects of its banking secrecy law / anti-whiteness programs and bitcoin”.

Current negotiations would determine whether the case could be resolved to “acceptable terms”, according to the deposit.

Block has been involved in several regulatory and legal challenges, in particular surveys In its context of compliance and its tax disputes, according to the file. He added that between January 2021 and March 2023, regulators of several American states examined the Block LMA program and reported alleged deficiencies linked to the compliance of the Banking Secret Act.

Subsequently, in January, Block reached regulations with several money transmission regulators and paid $ 80 million in penalties. In addition, he appointed an independent consultant to examine his AML program and ensure that corrective measures have been implemented within the framework of the regulations.

The NYDFS, however, was not part of these regulations. Instead, the agency presented to block conditions proposed in January, according to the file. Although Block has reserved an estimated responsibility for this issue, he said that the amount is not important for its financial statements.

The deposit did not disclose the details of the conditions of the regulation and block recognized no reprehensible act.

Block is also faced with a tax dispute in San Francisco, where local authorities claim that it owes additional taxes on Bitcoin income earned between 2020 and 2022. Seeking a refund.

In addition, Block cooperates with the SEC surveys and the Ministry of Justice, which was launched after a March 2023 report question its compliance and risk practices.

He added that he is “unable to predict the probable result” of these investigations and “cannot assure” that they will not have an “unfavorable material effect” on his commercial operations.

Block’s latest disclosure occurs while the company provides for realign your goal Towards the mining sector of Bitcoin in 2025. In a shareholder letter from November, he announced his intention to reduce his musical streaming service, tidal and finish his decentralized web project, TBD, while he develops in Mining equipment via the Proto initiative.