Block, Inc. (SQ) Failed to Disclose that a Former Employee Obtained Access to Subsidiary Cash App Investing’s Personal Client Information
A shareholder filed a class action on behalf of investors who acquired shares of Block, Inc. (NYSE: SQ) securities between November 4, 2021 and April 4, 2022, for violations of the Securities Exchange Act of 1934. Block, formerly known as Square Inc., is a technology company that creates financial service tools.
According to the complaint filed against Block, Inc., on April 4, 2022, Block announced that a former employee had improperly downloaded certain reports of the Company’s subsidiary, Cash App Investing, on December 10, 2021. The information in the reports included full customer names and brokerage account numbers, as well as brokerage portfolio value, brokerage portfolio holdings and/or stock trading activity. As many as 8.2 million Cash App Investing customers were affected. Prior to April 4, 2022, the company had not disclosed this information to shareholders. On this news, the Company’s stock fell $9.27, or 6.4%, to close at $135.92 per share on April 5, 2022, thereby injuring investors.
During the class period, defendants failed to disclose to investors: (1) that the Company lacked adequate protocols restricting access to customer sensitive information; (2) that, as a result, a former employee was able to download certain reports of the Company’s subsidiary, Cash App Investing, containing full customer names and brokerage account numbers, as well as brokerage portfolio value, brokerage portfolio holdings and/or stock trading activity; and (3) that the Company was reasonably likely to suffer significant damage, including reputational harm.
Next Steps: If you purchased shares of Block, Inc. between November 4, 2021 and April 4, 2022, you must file your papers for lead plaintiff by December 12, 2022. A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation. You do not have to participate in the case to be eligible for a recovery.
All representation is on a contingency fee basis. Shareholders pay no fees or expenses.