The Controversial Tether and Bitfinex Saga: Unveiling Shady Financial Practices
In a revealing investigative article, the Wall Street Journal shed light on the controversial practices of Tether, Bitfinex, and their associated companies. The report exposed the questionable methods employed by these entities to maintain their connections to the international banking system. Owned by iFinex, a corporation based in the Virgin Islands, both Tether and Bitfinex came under scrutiny for their involvement in shady financial activities.
Using Shady Methods to Stay Afloat
The Wall Street Journal article alleged that the group of companies connected to iFinex resorted to dubious tactics to navigate their relationship with the banking system. One such method involved opening accounts under the names of reputable businessmen while changing the names of the companies involved for appearance purposes.
“In Taiwan, the accounts were held in trust by Chrise Lee, an executive of Hylab Technology Ltd., which makes television set-top boxes. But the accounts were opened under the name Hylab Holdings Ltd., documents show.”
These actions were aimed at maintaining access to banking services without arousing suspicion. However, these accounts often became entangled in investigations related to terrorist financing and other financial crimes, resulting in significant losses for Tether and Bitfinex.
An $850 Million Seizure and Its Impact
The most substantial blow suffered by Tether and Bitfinex was the seizure of $850 million tied to Panama-based payment processor Crypto Capital Corp. Although there was no formal documentation confirming the relationship between Tether and these funds, it is widely believed that they were connected. The authorities’ confiscation dealt a severe financial blow to both companies.
Lawsuit Alleges Defamation and Misconduct
Christopher Harborne, a minority stakeholder who owns nearly 13% of the Tether-issuing company, AML Global Ltd., filed a lawsuit against Dow Jones & Company, the parent company of the Wall Street Journal. Harborne accused the publication of defamation and misconduct in their reporting.
False Accusations and Defamation
In his complaint, Harborne claimed that the Wall Street Journal falsely accused him and his company of fraud, money laundering, and financing terrorism. He asserted that the Journal possessed conclusive evidence to prove these accusations false but still chose to publish them.
“This defamation action arises from Defendant Dow Jones & Company, Inc.’s d/b/a The Wall Street Journal (the “Journal”) publication of an article in which it falsely accused Plaintiffs Christopher Harborne (“Mr. Harborne”) and AMLF of committing fraud, laundering money, and financing terrorists — even though the Journal and its reporters knew and possessed documentation that conclusively showed that those accusations are false.”
The Removal of Defamatory Content
Following the legal action taken by Harborne, the Wall Street Journal removed the section of the article that implicated him and his company in any wrongdoing. While acknowledging his ownership stake in Tether-issuing company AML Global Ltd., Harborne denied holding an executive position or engaging in illicit activities. He clarified that his stake was acquired as part of a Bitfinex reimbursement plan after a hacking incident during the early days of the exchange.
Hot Take: Unveiling Shady Financial Practices in the Crypto World
The controversy surrounding Tether, Bitfinex, and their associated companies shines a spotlight on the darker side of the cryptocurrency industry. The Wall Street Journal’s investigative article exposed the questionable methods employed by these entities to maintain their connections to the international banking system. The seizure of funds and the subsequent legal battle further highlight the complexities and risks involved in this rapidly evolving landscape.
By
By
By