Block agrees in principle to pay $764 million to settle DOJ AML probe as bitcoin gross profit falls 50%

Jack Dorsey’s Block has struck an in-principle agreement to resolve a U.S. Justice Department investigation into its anti-money-laundering controls, with a proposed $764 million payment that is larger than the company’s $566 million third-quarter profit. For PSPs and high-risk merchants, the useful part is not the headline number alone: the filing ties the settlement to alleged AML program failures and shows how compliance gaps can turn into both regulatory overhang and direct margin pressure.

1. The agreement was reached in October and disclosed in a November 3 SEC filing viewed by CoinDesk. It would defer for three years a criminal charge alleging that Block failed to maintain an effective anti-money-laundering program, as required under the Bank Secrecy Act.
2. The proposed resolution has a gross monetary component of approximately $964 million, reduced to $764 million after credits for earlier regulatory settlements. Block said it has already set aside that amount.
3. The investigation dates to 2023, when the Justice Department and Securities and Exchange Commission began examining Block’s compliance practices and related disclosures after a short-seller report. The SEC closed its separate investigation in March without recommending enforcement action.
4. The report, by Hindenburg Research, alleged that Cash App inflated user numbers by counting duplicate and fraudulent accounts, and that weak identity checks allowed criminals to use the platform for scams, money laundering and other illicit payments. Block rejected those findings as inaccurate and misleading.
5. In April 2025, New York’s financial regulator fined Block $40 million after finding serious gaps in its compliance systems. The regulator said a backlog of suspicious transaction alerts grew from about 18,000 in 2018 to more than 169,000 by 2020, and that one screening system did not automatically block bitcoin transfers to wallets linked to terrorism financing until their exposure exceeded 10%.

The timing matters because Block’s bitcoin economics are moving the other way. In the third quarter, bitcoin ecosystem gross profit fell 50% to $52 million from $104 million a year earlier, while revenue declined 11% to $1.8 billion, mainly because Block reduced fees on certain bitcoin transactions. Overall gross profit still rose 22% to $3.24 billion, but the settlement sits on top of a business that is already trading off margin in one of its highest-risk flows.