DOJ Reportedly Probing Tether Over Possible Sanctions and AML Rule Violations

Federal Investigators Probe Cryptocurrency Firm Tether

The federal government is investigating cryptocurrency company Tether for possible violations of sanctions and anti-money-laundering rules, according to people familiar with the matter.

The criminal investigation, run by prosecutors at the Manhattan U.S. attorney’s office, is looking at whether the cryptocurrency has been used by third parties to fund illegal activities such as the drug trade, terrorism and hacking—or launder the proceeds generated by them.

The Treasury Department, meanwhile, has been considering sanctioning Tether because of its cryptocurrency’s widespread use by individuals and groups sanctioned by the U.S., including the terrorist group Hamas and Russian arms dealers. Sanctions against Tether would generally prohibit Americans from doing business with the company.

Elon Musk Offer to Pay $2,923 for Missed Meeting Not Enough, SEC Says

The US Securities Exchange Commission says Elon Musk’s offer to pay $2,923 isn’t enough for standing up three agency lawyers who were set to question him last month in an investigation of his 2022 purchase of Twitter Inc.

Instead of rubber-stamping the billionaire’s proposal to reimburse the agency for flying the lawyers to Los Angeles in September while he was off in Florida to watch a SpaceX rocket launch, a judge should formally sanction Musk so he realizes his conduct is not a “trivial matter,” the SEC said Friday in a court filing.

SEC Charges Four Companies for “Downplaying” Cyber Incidents

As Ervine noted in the post, the dissenting commissioners take the position that the SEC is regulating by enforcement action and cited immaterial undisclosed details to support the charges. The dissent asserts that the level of detail the SEC charges that the four companies omitted will motivate companies to fill their disclosures with “immaterial details about an incident, or worse, provide disclosures [about] immaterial incidents.”

Whether or not you agree with the dissent’s perspective, it is certainly a question worth asking – will the agency’s charges against these four companies lead to improved cybersecurity incident reporting, or just more cybersecurity reporting with a level of detail that is immaterial from investors’ perspective?

SEC Market Monitoring Tool Allowed to Operate During Litigation

The SEC’s new market surveillance tool can operate while it faces a legal challenge, a federal court said.

The enhanced recordkeeping under the Consolidated Audit Trail has some elements that can warrant a preliminary injunction, but maintaining the integrity of a tracking system requires holding off until proper relief could be fashioned, Judge Alan D. Albright said.

The CAT requires broker-dealers, exchanges, and clearing firms to report real-time US equity and options trading data. Critics, including cryptocurrency groups and 19 states represented by Republican attorneys general, argued the tool would allow the SEC to spy on American trading activity….