Drylock will not fix the problem, but I would use it after I installed exterior french drains, exterior waterproofing, and a sumo pump.

Dig out around the foundation, coat exterior block with waterproofing. Install perimeter french drains. Patch interior wall cracks with hydrolic cement. Seal gap with cement caulk. Sump pump. Paint two coats of drylock on the wall. If it still fails, interior french drain..