Federal Prosecutors Take Over Tether Investigation, Looking Into Potential Fraud Committed by Executives: Report

The New York Justice Department is taking over a year-old investigation into top stablecoin issuer Tether.

Washington federal prosecutors warned top Tether executives last year that they could be charged with crimes related to their banking policies and activities relating to USDT.

According to a new Bloomberg report, US Attorney Damian Williams in Manhattan is taking over the inquiry because of the “uncertain legal terrain” surrounding digital assets and cryptocurrencies.

Former Justice Department fraud investigator Robert Park explains why passing crypto cases through multiple offices may be the best option for authorities.

“[Transferring cases] doesn’t happen often and there’s going to be pretty individual, unique circumstances each time…

There’s a steep learning curve for folks who get involved in these investigations and probably a fairly limited number of people who have real experience and understanding.”

Tether’s USDT is a stablecoin designed to be worth $1.00 at all times, and is the third-largest cryptocurrency by market cap at time of writing.

Tether has not issued a statement on the change in investigative offices. In response to last year’s investigation reports, a Tether spokesperson said the stablecoin issuer has always been transparent with regulators.

“Tether routinely has open dialogue with law enforcement agencies, including the US Department of Justice, as part of our commitment to cooperation, transparency and accountability.

We are proud of our role as industry leaders in promoting cooperation between industry and government authorities in the US and around the world.”

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Featured Image: Shutterstock/balabolka