Block sets aside $764M to resolve DOJ anti-money-laundering probe

Block has an agreement in principle with the U.S. Department of Justice to close out a multi-year look at its anti-money-laundering controls. The company disclosed the October deal in its third-quarter regulatory filings. Under the proposed deferred prosecution agreement, the DOJ would shelve for three years a charge that Block failed to run an effective AML program under the Bank Secrecy Act. If Block fully complies with the eventual terms, the DOJ would move to dismiss that charge with prejudice.

The price tag lands well north of the headline number. The expected terms call for a gross monetary component of roughly $964 million, which shrinks to a net payment of about $764 million once Block gets credit for earlier regulatory resolutions. Block had already accrued all $764 million as of September 30, 2026. The company cautions that final terms could differ, that a deal might not close at all, and that the ultimate cost could top what's currently reserved.

This one has been brewing since a short-seller report landed in March 2023. The SEC and the DOJ both opened reviews into the report's allegations, Block's compliance and risk practices, and its related disclosures. In March 2026, SEC staff told Block it had wrapped up and wouldn't recommend enforcement action. The DOJ floated potential resolution terms the same month, setting up October's handshake.

The news dropped alongside Block's third-quarter results. Total gross profit climbed 22 percent year over year to $3.24 billion, with Cash App up 27 percent to $2.07 billion and Square up 14 percent to $1.16 billion. Net income attributable to common stockholders came in around $566 million. Block also raised its full-year 2026 gross-profit outlook to $12.63 billion, good for 22 percent growth, and lifted related profitability guidance.

Bitcoin was the sore spot. Gross profit from the bitcoin ecosystem got cut in half, falling by $52 million to $52 million from $104 million a year earlier, while segment revenue slipped to roughly $1.80 billion from about $2.02 billion. Block pins the drop on a deliberate choice to lower fees on certain bitcoin transactions inside Cash App. Even so, the company keeps pitching bitcoin and stablecoins as fuel for Cash App's broader expansion.

The $764 million set-aside dwarfs the quarter's net income, a reminder of how much this probe has been weighing on the Jack Dorsey-led payments firm. It also stacks on top of earlier state-level settlements over Cash App's compliance programs, with Block saying it's still pouring money into remediation. Final terms and judicial approval remain outstanding, so the deal clears some fog — but leaves room for the bill to grow.