Amrita Ahuja: Know About The Indian-Origin Exec Named In Hindenburg's Latest Report On Jack Dorsey's Block

Hindenburg's latest report alleged that Ahuja dumped millions of dollars in stock during the pandemic year when the company's share prices were high.

In 2019, Ahuja joined Block as the CFO.

Source : Getty/ Twitter

Hindenburg Research on Thursday published a report on Jack Dorsey's Block, Inc., alleging that the payments firm overstated its user numbers and understated its customer acquisition costs. The Newyork-based short seller group said that a two-year investigation into Block, formerly known as Square Inc., revealed that the company has taken advantage of the very people it "claims to be helping".

The report also alleged that Block's Indian-origin COO and CFO Amrita Ahuja dumped millions of dollars in stock during the pandemic year when the company's share prices were high. 

Ahuja, an Indian immigrant's daughter, has extensive experience working for firms including Morgan Stanley, McKinsey & Company, and Fox Networks Group. 

Who Is Amrita Ahuja?

According to Ahuja's LinkedIn profile, she started her career as an investment banking analyst at Morgan Stanley. Later she moved to the Walt Disney Company as a strategic planning analyst. In 2007, she became the Director of Business Development in Fox Network’s Business Development Group where she focused on the intersection of digital media and entertainment. she was with Fox when it launched the streaming platform Hulu.

Starting in 2010, Ahuja spent eight years at Activision Blizzard in various roles, including as the CFO at Blizzard Entertainment. According to a Wall Street Journal profile article of Ahuja, she assisted Activision Blizzard in changing its business model from one that was characterised by seasonal in-store sales to one that was characterised by an online, always-on, multiplayer experience. 

In 2019, Ahuja joined Block as the CFO. In February 2023, she became the COO of the firm. Her profile says, "Block has four ecosystems: Square, which helps entrepreneurs start, run, and grow their business; Cash App, which allows individuals to send, spend, invest and save money; TIDAL, the global music and entertainment platform; and TBD, a platform for open-source financial services dedicated to cryptocurrency and the blockchain."

Ahuja is also the chairperson of Block’s industrial bank Square Financial Services, which is an independently governed subsidiary of Block. 

Block, under her leadership, has assisted small businesses and retailers in creating a digital presence to withstand the challenges brought on by the COVID-19 pandemic.

According to the Wall Street Journal, she is the daughter of Indian immigrants who own a daycare centre in a suburb of Cleveland. She has studied at the London School of Economics, Duke University, and Harvard Business School.

What Did Hindenburg's Report Say About Amrita Ahuja? 

On Ahuja, the report said that amidst the pandemic when Block's shares jumped on the back of increased user counts and revenue, Ahuja along with co-founders Jack Dorsey and James McKelvey dumped millions of dollars in stock.

The report said, "Block reported a pandemic surge in user counts and revenue, ignoring the contribution of widespread fraudulent accounts and payments. The new business provided a sharp one-time increase to Block’s stock, which rose 639 per cent in 18 months during the pandemic. As Block’s stock soared on the back of its facilitation of fraud, co-founders Jack Dorsey and James McKelvey collectively sold over $1 billion of stock during the pandemic. Other executives, including Ahuja and the lead manager for Cash App Brian Grassadonia, also dumped millions of dollars in stock."

The report said a large number of duplicate and scam accounts were shown to distort 'customer acquisition costs' – which Block management used to showcase its efficiency versus traditional banks. In March 2021, Ahuja said that Cash App acquires new users for less than $5 each. Ahuja said that Cash App achieves this low cost due to network effects, because “a customer can bring a new customer into Cash App at little to no cost for us” by inviting them to engage in a Cash App transaction. In May 2022, Block’s Cash App Lead Brian Grassadonia revealed that user acquisition costs had doubled to $10. 

The Hindenberg report alleged, "We strongly suspect Block’s reported cost of acquiring each new “transacting active” account is misleadingly low because single individuals may set up dozens or hundreds of accounts, including fake or scam accounts."

The report citing former employees alleged that until recently, Block failed to collect full user social security numbers for Cash Card users despite federal legal requirements to do so. Hindenberg's report alleged that Ahuja ignored this concern saying asking too many questions conflicted with Block’s “frictionless” banking. At an investment banking conference in 2020, she said, "Our ambition here is to provide the values and the services that people get today from traditional financial institutions and to do that in a seamless, easy-to-onboard, frictionless, consumer-friendly way as possible."

Block in its response has called Hindenburg's report “factually inaccurate and misleading.” Block said it intended to “explore legal action” against Hindenburg.