Hindenburg Research on Thursday disclosed short positions in Block Inc and alleged that the payments firm led by Twitter co-founder Jack Dorsey overstated its user numbers and understated its customer acquisition costs.
and alleged that the payments firm led by Twitter co-founder Jack Dorsey overstated its user numbers and understated its customer acquisition costs.
Block did not immediately respond to a Reuters request for comment. Reuters could not verify the claims raised in the report. "Our 2-year investigation has concluded that Block has systematically taken advantage of the demographics it claims to be helping," Hindenburg said in a note published on its website.
The app had 51 million monthly transacting actives, a 16% year-over-year increase during December 2022, Block said in fourth-quarter earnings letter. " What I am really concerned about is the CashApp, accusations of fraud, multiple accounts, opening accounts and fake names. And it doesn't seem like that would be something that they would allow," said Christopher Brendler, senior analyst at D.A. Davidson & Co.
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