The company behind the stablecoin Tether (USDT) has denied a report by The Wall Street Journal (WSJ) that claims it has ties to entities that falsify documents and use shell companies to maintain access to the banking system.
On March 3, the WSJ reported on leaked documents and emails stating that entities related to Tether and its sister cryptocurrency exchange Bitfinex falsified sales invoices and transactions and hid behind third parties to open bank accounts that they could not open. .
In a March 3 statement, Tether called the report’s findings “stale allegations from the past” and “inaccurate and misleading,” adding:
“Bitfinex and Tether have world-class compliance programs and adhere to Anti-Money Laundering, Know Your Customer, and Counter-Terrorist Financing legal requirements.”
The company later said it is a “proud” partner with law enforcement and “routinely and voluntarily” assists authorities in the United States and abroad.
The chief technology officer of Tether and Bitfinex, Paolo Ardoino, tweeted on March 3 that the report was “misinformed and inaccurate” and called the WSJ a clown.
I’m on the anniversary of PlanB #hole
So much energy and people love to talk about it #Bitcoin
When I was on stage I heard some clowns honking, pretty sure it was the WSJ.
As always tons of misinformation and inaccuracy. Poor people, it must be difficult but they need better media.— Paolo Ardoino (@paoloardoino) March 3, 2023
Cointelegraph contacted Tether and Binfinex for comment on the report and statement but did not receive a response at the time of publication.
WSJ report claims Tether and Bitfinex obscured themselves
The WSJ report outlines — through an informed review of leaked emails and documents — Tether and Bitfinex’s transactions to stay connected to banks and other financial institutions that, if lost, would pose an “existential threat” to the business according to the lawsuit filed by the couple against Wells Fargo bank.
One of the leaked emails showed a China-based company intermediary trying to “circumvent the banking system by providing false invoices and sales contracts for every deposit and withdrawal.”
There are also allegations in the report that Tether and Bitfinex use various methods to skirt the control that will be restricted from financial institutions, and have links to the firm that allegedly laundered money for terrorist organizations designated by the United States, among others.
Meanwhile, a person familiar with the matter also told WSJ that Tether has been investigated by the Department of Justice (DOJ) led by the US Attorney’s Office for the Southern District of New York. The nature of the investigation could not be determined.
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Tether has faced numerous allegations of wrongdoing in recent months and recently had to downplay a separate WSJ report in early February that claimed four people controlled roughly 86% of the company as of 2018.
In addition, it must fight what it called “FUD” (fear, uncertainty, and doubt) from the December 2022 WSJ report on guaranteed loans and then promised to stop providing funds from reserves.