Cryptocurrency giant Tether denies reports that it is under investigation by federal investigators for violating economic sanctions or anti-money laundering rules

The Wall Street Journal (WSJ), a daily economic newspaper, reported that the Manhattan US Attorney's Office has launched an investigation into Tether, Inc., the issuer of the stablecoin Tether (USDT). The investigation is said to be for 'possible violations of economic sanctions or anti-money laundering regulations,' but Tether CEO Paolo Ardoino has completely denied the report, calling it 'irresponsible and speculative.'

Exclusive | Federal Investigators Probe Cryptocurrency Firm Tether - WSJ

The WSJ report said that 'prosecutors in the Manhattan U.S. Attorney's Office are investigating whether third parties used cryptocurrencies to fund illegal activities such as drug trafficking, terrorism or hacking, or to launder proceeds from cryptocurrencies,' and cited 'people familiar with the matter' as the source of the information.

The WSJ also reports that the Treasury Department is considering imposing sanctions on Tether, given its widespread use by targets of economic sanctions, such as Hamas and Russia's defense industry.

In response to the article, CEO Ardoino wrote on Twitter, 'Tether regularly communicates with law enforcement agencies to prevent misuse of USDT by rogue nation states, terrorists, and criminals. If the article's false claim that 'Tether is under investigation' is true, we will immediately know. Based on this, we can prove that the article's claims are demonstrably false.'

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

The company also posted a notice on its website titled, 'Tether condemns the WSJ's irresponsible reporting and supports a strong law enforcement record.'

Tether Slams WSJ's Irresponsible Reporting, Stands by Strong Law Enforcement Track Record - Tether.io
https://tether.io/news/tether-slams-wsjs-irresponsible-reporting-stands-by-strong-law-enforcement-track-record/

In the statement, Tether said, 'It is wildly irresponsible for the WSJ to publish such a wild story without any known sources and no authorities to verify the rumors. The story is based solely on speculation and Tether has no knowledge of any investigation into the company. The story also inadvertently overlooks Tether's extensive and well-documented interactions with law enforcement to crack down on criminals seeking to misuse Tether and other virtual currencies.'

A spokesman for the U.S. Attorney's Office declined to comment on the case.