Hindenburg Research is taking aim at Jack Dorsey's Block, formerly known as Square, alleging that what the influential short seller called the payments company's 'magical' financial technology relied on something less enchanting: fraud.
that what the influential short seller called the payments company's"magical" financial technology relied on something less enchanting: fraud.
Shares in the conglomerate have suffered massive losses since Hindenburg issued its report alleging fraud and other malfeasance. In trading Monday, the company's Adani Enterprises gained 4.8% but shares in other Adani listed companies fell between 5% and 20%. "Core to the issue is that Block has embraced one traditionally very 'underbanked' segment of the population: criminals," the report alleges."The company's 'Wild West' approach to compliance made it easy for bad actors to mass-create accounts for identity fraud and other scams, then extract stolen funds quickly."on Thursday, calling Hindenburg's claims"factually inaccurate and misleading." The company said it intends to work with the U.S.
The firm's allegations against Block focus on the company's Cash App service, a mobile payment tool that lets people transfer money to each other via their phones. According to Hindenburg's report, the Cash App service facilitates payments for criminal activity, including sex trafficking, as well as fraud. The service was also used in used in pandemic relief fraud, Hindenburg alleged.
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