Tether Intensifies Fight Against Illicit Crypto Activities, Collaborates with US Law Enforcement

Tether is reaffirming its dedication to working with U.S. law enforcement and regulatory bodies to combat illegal activities. The company, known for issuing the stablecoin Tether, is intensifying its efforts to curb unlawful crypto transactions. This includes sharing recent communications with the U.S. House Financial Services Committee and the U.S. Senate Committee on Banking, Housing, and Urban Affairs.

In its initial communication, Tether highlighted its focus on know-your-customer (KYC) protocols and adherence to regulations, noting the establishment of a dedicated Compliance Department equipped with a robust KYC/Anti-Money Laundering (AML) program. The company also mentioned that its KYC procedures have been reviewed by the IRS for FinCEN compliance.

Furthermore, Tether disclosed its use of Chainalysis’s reactor tool to monitor crypto market activities, specifically for tracking transactions in Tether’s secondary market. This tool aids in analyzing blockchain transactions to identify wallets potentially involved in activities deemed problematic by the U.S. government, including funding organizations like Hamas and Hezbollah.

Tether emphasized its proactive approach in using these tools for spotting suspicious transactions and its policy of informing law enforcement and anti-terrorist financing agencies about such activities.

Regarding its collaboration with law enforcement, Tether is actively working with the U.S. Secret Service and the FBI to track and disrupt the use of stablecoins in funding illegal activities, as well as to recover stolen funds and return them to victims.

In another letter, Tether detailed its actions in freezing 326 wallets containing around 435 million USDT, in coordination with the U.S. Department of Justice, Secret Service, and FBI. This move aligns with the Office of Foreign Assets Control (OFAC) Specially Designated Nationals (SDN) List, representing not just a compliance step, but a proactive security measure. This expansion of sanctions controls to the secondary market is seen as setting a new standard in the industry.

Concluding, Tether expressed its commitment to establishing new benchmarks in security and fostering relationships with law enforcement agencies, hoping to inspire similar actions across the industry. The company views its collaboration with financial regulators as a model that should become standard practice in the sector.

source