U.S. Investigation into Tether Intensifies Amid Allegations of Sanctions Violations and Money Laundering Risks
U.S. authorities are ramping up their investigation into Tether, the largest stablecoin issuer globally, amid mounting concerns over potential breaches of anti-money laundering (AML) regulations and sanctions compliance. Reports from The Wall Street Journal indicate that officials are probing Tether's cryptocurrency, USDT, to assess whether it has been used by third parties in illicit activities, including terrorism, drug trafficking, and hacking.
This investigation is being led by the Manhattan U.S. Attorney’s Office, with the Treasury Department reportedly considering sanctions that could restrict or bar U.S. residents and businesses from dealing with Tether. Allegations suggest that individuals and entities subject to U.S. sanctions—such as the Hamas group and certain Russian actors—may have utilized USDT for financial transactions. However, Tether’s CEO, Paolo Ardoino, responded swiftly, labeling the claims as outdated and speculative. He emphasized on social media that "there is no indication that Tether is under investigation."
Tether's regulatory scrutiny is not new; the Commodity Futures Trading Commission (CFTC) previously alleged that Tether made misleading claims regarding USDT's dollar backing. Amid ongoing scrutiny, Tether continues to assert that it collaborates with international law enforcement to combat illegal financial activities.