Block, the parent company of Cash App and Square, reached an agreement in principle with the U.S. Department of Justice (DOJ) that provides for a net payment of approximately US$ 764 million to resolve an investigation into anti-money laundering controls. The deal, reached in October, was disclosed in a regulatory filing made by the company on Tuesday (3), but it still depends on formalization and court approval.
The understanding relates to the allegation that the company did not maintain an effective anti-money laundering program, as required by U.S. banking law, known as the Bank Secrecy Act.
The proposed resolution provides for a three-year deferred prosecution agreement, a mechanism by which the DOJ would defer prosecution of the charge while Block complied with certain obligations. If all conditions were met during the period, the department would request the permanent dismissal of the charge covered by the agreement.
The document also sets out the risks if the negotiation is not completed or the company fails to comply with its obligations. In those circumstances, the DOJ may proceed with legal measures related to the charge.
Document provides for net payment lower than the gross amount of the agreement
The Form 10-Q filed with the U.S. Securities and Exchange Commission (SEC) details an important difference between the amounts involved in the negotiation.
The expected gross financial component is approximately US$ 964 million, but the expected net disbursement falls to US$ 764 million due to credits related to prior regulatory resolutions. The US$ 200 million difference does not represent a discount granted without consideration, but rather the recognition of those credits in the calculation presented by the company.
Block reported that it had already recorded an accounting provision of US$ 764 million as of September 30, 2026. The entry represents recognition of the estimated obligation in the financial statements, not confirmation that the amount has actually been paid.
The company cautioned that there is no guarantee the agreement will be completed under the terms currently contemplated. The document also acknowledges the possibility of losses exceeding the provisioned amount, depending on the final terms of the resolution.
The disclosure came on the same day the company reported positive quarterly results and raised its financial expectations for 2026.
Cash App gross profit grew 27% compared with the third quarter of 2025, reaching approximately US$ 2.07 billion, driven mainly by credit products and financial services. At Square, focused on merchants, growth was 14%, with gross profit of US$ 1.16 billion.
Overall, Block reported quarterly gross profit of US$ 3.24 billion, up 22% year over year. Adjusted operating income reached US$ 923 million, growth of 92%.
With this performance, the company raised its 2026 gross profit guidance from US$ 11.98 billion to US$ 12.63 billion, which would represent annual growth of approximately 22%.
The results show the operational expansion of Block's two main platforms as the company seeks to close a regulatory matter of significant financial scale. The resolution with the DOJ, however, remains subject to the signing of a definitive agreement and approval by the U.S. courts.
