Block, the Jack Dorsey-founded fintech formerly known as Square, is in trouble after falling within the crosshairs of notorious short-seller Hindenburg Research.

Hindenburg is one of a new-ish breed of short-seller that performs deep research into companies it thinks are overhyped or dabbling in fraud and takes a short position on its target’s stock before publishing its findings. It most recently grabbed headlines for hammering the business empire of India’s Gautam Adani, one of the world’s richest men, but you may also remember it from previous hits such as hydrogen-powered-truck outfit Nikola (whose CEO Trevor Milton ended up being convicted of fraud) and health-tech startup Clover Health (resulting in a Securities and Exchange Commission investigation and investor lawsuit).

Now Hindenburg has turned its attention to Dorsey’s Block, shares in which dropped as much as 22% on the report’s release, before partially recovering. Hindenburg said it had been investigating Block for two years, and accused it of:

– Misleading investors by overstating its genuine user counts, with former employees estimating as much as three quarters are “fake, involved in fraud, or…additional accounts tied to a single individual.”

– Failing to ban fraudsters from using its platform (eyebrow-lifting line: “This phenomenon of allowing blacklisted users was so common that rappers bragged about it in hip hop songs.”)

– Acting as a regular conduit for fraudulent COVID payments due to lax compliance, despite “internal employee concerns, along with warnings from the Secret Service, the U.S. Department of Labor OIG, FinCEN, and State Regulators.” (Again, references are made to rapper braggadocio.)

– Allowing its Cash App platform to be used for paying contract killers, drug dealers, and sex traffickers, and suppr