Bitfinex Tether Investigation Update – Crypto Exchange Refutes NYAG Filing

The New York Attorney General’s office has updated its case of Bitfinex and Tether Investigation. In a filing with the New York State Supreme Court Appeal Division, NYAG criticized Bitfinex and Tether’s efforts to end the investigation of these companies. How did the Crypto Exchange and Tether react to the NYAG’s filing? 

14 December, 2019 | AtoZ Markets – Bitfinex and Tether are under investigation for accounting camouflage. Bitfinex is alleged of improper $ 625 million transferred. That was supporting Tether’s stablecoin to cover up Bitfinex’s liquidity shortage. Attorney General James wrote that Bitfinex and Tether are trying to stop “the ongoing investigation.”

Lawyers for Bitfinex and Tether responded in a filing on the 13th of December. And they said that the NYAG does not have the power to investigate the companies. Because “Tethers are not securities or commodities. “

Bitfinex and Tether Investigation Update: Responses of Both Parties

However, Attorney General James said that the two companies failed twice to meet the “exceptionally high threshold” to end an NYAG investigation. Jacques said it is especially perverse for respondents to criticize the adequacy of potential legal claims. Respondents are the ones who refused to disclose documents and information that would be directly related to their responsibility. James argued that “Bitfinex and Tether are trying to dismiss a legal action brought by the NYAG. But there is, in fact, no such legal action yet only an investigation, which could lead to legal action in the future.”

In an article published on the website, Tether responded to the NYAG brief. It also claimed that the state “offers a very misleading factual presentation.” And it does not identify any victims of the exchange.

“In the end, the Attorney General did not identify any victims in all of these proceedings, as there are none,” added Tether. “Holders of tethers have the right to redeem them back for exactly what they paid no more no less. And Tether did not have to satisfy redemption requests to anyone, even after the NYAG’s incendiary case.”

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Why Did NYAG Accuse Bitfinex and Tether?

Last April, NYAG accused Bitfinex and Tether. Tether and Bitfinex were for using $700 million from the stable fund’s reserves to cover up the losses of $ 850 million. Both exchanges said that the money had been deposited with a Panamanian company called Crypto Capital. But it was later seized and safe in several jurisdictions. That included the United States, Poland, Portugal, and the United Kingdom, all through no fault of Bitfinex.

It took another turn on May 16. The Supreme Court allowed the motion to change the substance and the temporal scope of the initial injunction filed. Bitfinex also wanted the Supreme Court to help further and reject the NYAG’s request.

But later in August, the same court dismissed pleas by Bitfinex’s parent company, to drop the New York Attorney General (NYAG) lawsuit against its subsidiary.

AtoZ Markets team has contacted Bitfinex and Tether regarding this matter. We will keep you posted as soon as we receive any quote or comment from them.

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