March 30, 2023

Tether Accused of Using Fake Documents and Shell Companies to Access Banking System

Tether, the world’s largest stablecoin, is facing fresh allegations of using fake documents and shell companies to gain access to the traditional banking system. According to a report by the Wall Street Journal on Friday, Tether’s parent company, Tether Holdings Ltd., went to extraordinary lengths to stay connected to the financial system and open bank accounts.

The report cites emails and documents that allegedly show Tether used problematic third parties that used “hundreds of shell companies” to help the company gain access to the banking system. The Journal also claims that Tether’s backers used fake sales invoices and contracts to circumvent the banking system.

Stephen Moore, one of the owners of Tether Holdings Ltd., reportedly admitted to dropping a major Chinese trader who tried to use fake documents to access the banking system, claiming it was “too risky.” The report also alleges that Tether used shell companies to hide its true ownership and avoid regulatory scrutiny.

Tether has been under scrutiny for some time, with critics questioning the company’s claims that each USDT token is backed by a dollar in reserve. The company has also faced allegations of market manipulation and insider trading.

The latest allegations are likely to add to the growing concerns about Tether’s operations and could lead to increased regulatory scrutiny. The stablecoin has a market capitalization of over $70 billion and is the most-traded cryptocurrency in the world.

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