Cryptocurrency company Tether condemned a report from The Wall Street Journal (WSJ) posted Friday (Oct. 25) that said federal agencies are investigating the company for possible violations of sanctions and anti-money laundering (AML) rules.
The WSJ report cited unnamed sources.
“These stories are based on pure rank speculation despite Tether confirming that it has no knowledge of any such investigations into the company,” Tether said in a statement posted on its website. “The article also carelessly glosses over Tether’s well-documented and extensive dealings with law enforcement to crack down on bad actors seeking to misuse tether and other cryptocurrencies.”
The WSJ reported that prosecutors at the Manhattan U.S. attorney’s office are looking at whether Tether’s cryptocurrency has been used by third parties to fund illegal activities or to launder the proceeds from such activities.
It also reported that the Department of the Treasury has been considering sanctioning the company because its cryptocurrency has been used by individuals and groups sanctioned by the U.S. And it said the Department of Justice began an investigation into Tether several years ago.
Neither the Treasury Department nor the Justice Department immediately replied to PYMNTS’ request for comment sent outside of normal business hours.
The WSJ article also said that the publication had previously reported that Tether’s cryptocurrency is used by the North Korean nuclear weapons program, Mexican drug cartels, Russian arms companies, Middle Eastern terrorist groups and Chinese manufacturers of chemicals used to make fentanyl.
Tether CEO Paolo Ardoino wrote in a Friday post on social platform X: “As we told to WSJ, there is no indication that Tether is under investigation. WSJ is regurgitating old noise. Full stop.”
As we told to WSJ there is no indication that Tether is under investigation. WSJ is regurgitating old noise. Full stop.
— Paolo Ardoino ?? (@paoloardoino) October 25, 2024
In another Friday post on X, Ardoino wrote that Tether deals with law enforcement officials regularly and directly to prevent misuse of the company’s stablecoin, USDT, and would know if the company was being investigated.
“Based on that, we can confirm that the allegations in the article are unequivocally false,” Ardoino wrote.
At Tether, we deal regularly and directly with law enforcement officials to help prevent rogue nations, terrorists and criminals from misusing USDt. We would know if we are being investigated as the article falsely claimed. Based on that, we can confirm that the allegations in…
— Paolo Ardoino ?? (@paoloardoino) October 25, 2024
Tether (USDT) is the largest stablecoin by market cap, but it is primarily used as a trading pair on exchanges for liquidity and stability and its regulatory status may cause businesses to hesitate in fully embracing it across their operations, PYMNTS reported Monday (Oct. 21).
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