“Jack Dorsey’s fintech startup Block committed $1 billion in financial fraud by overstating the number of users while understating client acquisition expenditures.”
— Hindenburg study
The Hindenburg investigation accused Amrita Ahuja, of liquidating millions of dollars in equities during the pandemic as the firm’s price rose due to its facilitation of fraud, reported nriaffairs.com.
According to the Hindenburg study, Jack Dorsey’s fintech startup Block committed $1 billion in financial fraud by overstating the number of users while understating client acquisition expenditures.
The study also accused the company’s Indian-origin CFO, Amrita Ahuja, of liquidating millions of dollars in equities during the pandemic as the firm’s price rose due to its facilitation of fraud.
According to the report, “As Block’s stock soared on the back of its facilitation of fraud, co-founders Jack Dorsey and James McKelvey collectively sold over $1 billion of stock during the pandemic. Other executives, including CFO Amrita Ahuja and the lead manager for Cash App Brian Grassadonia, also dumped millions of dollars in stock.”
According to her LinkedIn page, Amrita Ahuja is the Block COO and CFO. In 2001, she worked as an investment banker for Morgan Stanley, a financial services company.
Ahuja has a Bachelor of Science in Computer Science from the University of Massachusetts, Amherst, and an MBA from the Wharton School at the University of Pennsylvania. The Wall Street Journal (WSJ) said that her parents were Indian immigrants who owned a daycare centre in a Cleveland suburb.
Hindenburg alleged that Block circumvented a fundamental banking restriction meant to protect retailers in order to covertly increase its revenue with a spike of pandemic Cash App customers. “Interchange fees” are assessed to businesses for taking certain credit and debit cards
Hindenburg in its report said, “Our 2-year investigation has concluded that Block has systematically taken advantage of the demographics it claims to be helping.” According to the research company, Block’s Cash App prospered by catering to “unbanked” users.
Former Block employees were quoted in the report by the US short-seller, who claimed to blame for the over $100 billion market loss in Adani Group, as saying that they thought 40% to 75% of the accounts they reviewed were fake, bogus, or extra accounts linked to a single person.
The report also claimed that the business adopted a different strategy and chose to target criminals, a relatively “under-banked” demographic.
The research added, “Core to the issue is that Block has embraced one traditionally very under-banked segment of the population: criminals. 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.”
Hindenburg alleged that Block circumvented a fundamental banking restriction meant to protect retailers in order to covertly increase its revenue with a spike of pandemic Cash App customers. “Interchange fees” are assessed to businesses for taking certain credit and debit cards.
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