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Key takeaways
- Block, the company behind Cash App, says it agreed in principle with the Justice Department in October 2026 to resolve the department's inquiry through a deferred prosecution agreement covering a charge about its anti-money-laundering program.
- The deal is expected to carry a gross amount of about $964 million and a net payment of about $764 million after credit for earlier regulatory settlements. Block has set aside $764 million. It is not final: it still needs a final agreement and court approval.
- Under a deferred prosecution agreement, the charge is put on hold for three years, and the Justice Department will ask the court to dismiss it if Block meets its obligations. It is not a conviction.
- Block's filing does not say Cash App customers' bitcoin or cash is affected. Block separately reported that its bitcoin gross profit fell 50% from a year earlier, mainly because it cut fees on certain bitcoin transactions.
Block, the company behind Cash App, says it expects to pay about $764 million to resolve a US Justice Department inquiry into its anti-money-laundering controls. The disclosure came in Block's quarterly filing on November 3, 2026. If you buy bitcoin on Cash App, here is what the filing actually says, what it doesn't, and what it changes for you.
What Block disclosed
In its Form 10-Q for the third quarter (opens in a new tab), Block says that in October 2026 it and the Justice Department agreed in principle to settle the matter through a deferred prosecution agreement. Under it, the Justice Department would defer for three years a charge, in the filing's words, that the company "failed to maintain an effective anti-money laundering program in violation of the Bank Secrecy Act."
Block expects the agreement to include a gross monetary amount of about $964 million. After credit for earlier regulatory settlements, the expected net payment is about $764 million, and Block says it had accrued that amount as of September 30, 2026. Reuters (opens in a new tab) and CoinDesk (opens in a new tab) also reported the disclosure.
It isn't final yet
Block is careful to say the deal is not done. The filing says the resolution still needs a final agreement that all parties accept and approval from a court. Block also warns that the final terms could cost more than the amount it has set aside, and that it can't promise a final agreement will be reached.
A deferred prosecution agreement is a common way for US prosecutors to resolve cases against companies. The charge is filed but put on hold. If the company meets the agreement's obligations for the full term, here three years, prosecutors ask the court to dismiss it. If the company breaks the agreement, it can be prosecuted on the charge. It is not a conviction, and the filing does not describe a guilty plea.
How the inquiry started
According to the filing, the SEC and the Justice Department both sent Block inquiries shortly after a short seller published a report about the company in March 2023. The SEC staff told Block in March 2026 that it had finished its investigation and did not plan to recommend enforcement action. The Justice Department put forward possible settlement terms that same month.
This is not the first time regulators have penalized Block over its anti-money-laundering controls. In January 2025, 48 state financial regulators (opens in a new tab) announced an $80 million fine for Bank Secrecy Act and anti-money-laundering violations. In April 2025, New York's Department of Financial Services (opens in a new tab) announced a $40 million penalty and required Block to hire an independent monitor.
What happened to Cash App's bitcoin business
The same day, Block's third-quarter shareholder letter (opens in a new tab) showed its bitcoin business earning less. Bitcoin ecosystem gross profit fell 50% from a year earlier, to $52 million from $104 million. Block says the main reason was a strategic decision to lower the fee it charges on certain bitcoin transactions on Cash App. Block's total gross profit rose 22% to $3.24 billion.
In plain terms: Block chose to charge less on certain bitcoin transactions. Block calls that a strategic decision, and nothing in the letter ties it to the safety of customer bitcoin.
What this means for you
Nothing in Block's filing says customer accounts or customer bitcoin are affected. The 10-Q says Block's contracts give Cash App customers legal ownership of the bitcoin Block holds for them, and that Block does not lend or pledge it to third parties. The same section says customers generally bear the risk of loss from fraud or theft, which is one more reason to guard your login. The case is about whether Block's compliance checks were strong enough.
Those checks are the ID requests, transfer limits and occasional account reviews you may have noticed. They exist because laws like the Bank Secrecy Act require money apps to know who their customers are and to report suspicious activity. Don't be surprised by identity requests; they are a normal part of using a money app. Just make sure any such request comes through the official Cash App app, never a text, call or social media message. Our guide to impersonation scams shows how fake support contacts work.
This is education, not investment advice, and not a view on Block's stock.
Frequently asked questions
Is my Cash App bitcoin at risk because of this?
Block's filing describes a compliance case about its anti-money-laundering program, not a loss of customer funds. The same filing says Block's customer contracts give customers legal ownership of the bitcoin Block holds for them, and that Block does not lend or pledge it. It also says customers bear the risk of loss from fraud or theft unless Block was grossly negligent or acted with willful misconduct. Normal crypto risks, such as price swings and scams, still apply.
Did Block admit to a crime?
The filing describes a deferred charge that Block's anti-money-laundering program was not effective. It does not describe a guilty plea. The final terms, including whether Block will accept any statement of facts, have not been published. If Block meets the agreement's obligations for three years, the Justice Department will move to dismiss the charge.
What is an anti-money-laundering program?
Under the Bank Secrecy Act, money transmitters like Cash App must verify who their customers are, watch for suspicious transfers and report them. It is the reason apps ask for your ID before you can buy or send larger amounts of crypto.
Is the settlement final?
No. Block says it still has to reach a final agreement with the Justice Department and get court approval, and that the final cost could end up higher than the $764 million it has set aside.
Sources
- Block, Inc. Form 10-Q for the quarter ended September 30, 2026 (Note 16, Commitments and Contingencies) (opens in a new tab) — Block, Inc. via SEC EDGAR
- Block Q3 2026 shareholder letter (opens in a new tab) — Block, Inc. via SEC EDGAR
- Block lifts profit outlook on Cash App strength, reaches preliminary DOJ settlement (opens in a new tab) — Reuters
- Jack Dorsey's Block faces $764 million DOJ settlement as bitcoin profit plunges 50% (opens in a new tab) — CoinDesk
- Superintendent Harris secures $40 million settlement with Block, Inc. (April 10, 2025) (opens in a new tab) — New York State Department of Financial Services
- State regulators issue $80 million penalty to Block, Inc., Cash App for BSA/AML violations (January 15, 2025) (opens in a new tab) — Conference of State Bank Supervisors
Published November 4, 2026 by Dave McNaught. Educational content, not financial, legal or tax advice. Spot an error? Request a correction.
Dave McNaught
Dave McNaught has worked in IT since 1999 and founded All Business Technologies (ABT) in 2003, a Boston-area firm providing Managed IT, Cybersecurity, Managed AI, Web Design and App Development. He publishes The Crypto Guide.