Block Inc. agreed to pay $ 40 million to settle the accusations of the New York Financial Services Department that the Company did not properly manage its money laundering guarantees, according to a regulator press release.
Block, which operates the species application for peer-to-peer transactions and was previously known as Square Inc., is under the commands of the New York regulator to repair all the gaps and submit to an outdoor monitor. The regulator noted that the “lax treatment of blockchain activities and the payments of high -risk bitcoin activities has left effectively anonymous transactions via its system.
“The rapid growth of block cash application in the absence of a robust compliance function has created risks and vulnerabilities that have violated the rules that financial service companies operating in New York must adhere,” said Superintendent Adreien Harris, the nydfs superintendent in the press release. “The ministry has decisive measures to guarantee responsibility, including the appointment of an independent monitor to supervise corrective measures.”
In a block statement, the company said that it had not admitted any of the conclusions in the New York case, but it is “happy to put this case behind us”.
“Following our recent regulation with our other state monetary transmission regulators, we have now reached an agreement with the final regulator of the transmission of state money remaining, the New York Department of Financial Services, to resolve a case mainly linked to the previous compliance program of Cash Apple,” said the company.
The regulator’s examinations covered a period covering in 2021 and 2022 to the company founded by Jack Dorsey, and the resulting consent order noted “serious conformity deficiencies” which had created “a high risk vulnerable risk by operating by criminal actors”.
Since 2018, Block has organized a Bitlicense from New York to carry out digital asset operations in the state.
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