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Bitfinex-Tether-Scandal-Related Boss to Proceed to Trial for Crypto Fraud in 2022

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Federal judge has ruled that former NFL investor Reginald Fowler will stand trial next year for fraud that involves crypto exchanges

As reported by Law360, a federal judge from NYC has named a preliminary date in 2022 for the trial of former NFL investor Reginald Fowler.

For providing shadow banking services, he allegedly used Crypto Capital, the payment processing company involved in an $850 million scandal involving Bitfinex and Tether.

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Fowler is accused of crypto fraud involving millions of U.S. dollars and unregulated transactions for crypto exchanges and shadow banking operations.

Passing off unlicensed crypto transactions for real-estate-related payments

Reginald Fowler, who made a one-time investment into the NFL’s Minnesota Vikings franchise, has been accused of performing a shadow business with bank accounts for crypto exchanges.

Fowler had cooperated with several banks that provided accounts and financial services to digital exchanges. He misled banks by telling them he was working with real estate deals while, in fact, he was processing unlicensed crypto transactions and stored funds for crypto exchanges.

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The accused also provided falsified instructions for funds transfers to conceal his big illegal crypto business operations.

The man may be charged with bank fraud and conspiracy for running illegal transactions on the scale of a large business.

Related documents show that Fowler used payment processing company Crypto Capital (serviced by his Global Trading Solutions LLC in the past) for those unlicensed operations.

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Crypto Capital and Bitfinex-Tether $850 million fraud

The aforementioned company was involved in fraud related to prominent crypto companies with the same management team—Bitfinex and Tether Ltd—which suffered an $850 loss of their clients’ money.

iFinex, the parent company, had paid an $18.5 million fine to settle the case and was forced to stop providing its services in New York State.

The loss of almost $900 million was the result of Bitfinex and Tether’s cooperation with Crypto Capital.

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Tether and Bitfinex Ordered to Pay $42.5 Million Fine by the CFTC

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Tether and Bitfinex were ordered by the CFTC to pay fines worth a total of $42.5 million for various violations.

The United States Commodity and Futures Trading Commission (CFTC) has ordered Tether and Bitfinex to pay fines worth $42.5 million.

  • In a release from today, October 15th, Tether Holdings Limited, Tether Limited, Tether Operations Limited, and Tether International Limited – all companies associated with the issuer of the largest stablecoin USDT, Tether, were ordered to pay a fine worth $41 million.
  • This was issued by the CFTC on the grounds of “misleading statements and omissions of material fact in connection with the U.S. dollar token USDT.”
  • Additionally, the companies have been ordered to cease and desist from any further violations of the CEA (Commodity Exchange Act).
  • Going forward, the Commission also issued a separate order against BFXNA Inc., iFinex Inc., and BFXWW Inc – companies associated with the popular cryptocurrency exchange Bitfinex.
  • They must pay $1.5 million in a civil monetary penalty for engaging in illegal, off-exchange retail commodity transactions with US citizens on the cryptocurrency exchange.
  • Commenting on the matter was Rostin Behnam, acting chair of the CFTC, who said:

The case highlights the expectation of honesty and transparency in the rapidly growing and developing digital assets marketplace. […] The CFTC will continue to take decisive action to bring to light untrue or misleading statements that impact CFTC jurisdictional markets.”

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Tether Users To Explore the Maldives With USDT on Travala.com

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  • Travala announces Tether users can now book a trip with USDT.
  • The USDT token can be used on the Travala.com platform.
  • Travala’s native token, AVA, records a 3.35% gain.

The world-leading blockchain-based travel booking platform — Travala continues to incorporate more travel utilities to its platform. Today, the Travala team announced to the Tether fans that they can now book a dream trip to the Maldives with USDT in a tweet.

Particularly, with Tether’s USDT, travelers can book flights and over-the-water bungalows. Not to mention, enjoy activities such as snorkeling, boat excursions, tours, and a lot more on Travala.com.

What’s more, Tether (USDT) is a stablecoin that aims to keep cryptocurrency valuations stable. The USDT tokens in circulation are proportional to U.S. dollars. Meanwhile, the native token of Travala is AVA. AVA is a BEP-2 token based on the Binance Chain.

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Moreover, Travala allows travelers from all across the globe to book and explore several travel options. Travala accepts Credit Card, Debit Card, and cryptocurrency. Besides, AVA’s current price is $3.1 with a market cap of $164,608,058.

To promote accessibility to anyone and everywhere, Travala aligns travel bookings with the ethos of decentralized technology. With AVA, tourists can easily get discounts, loyalty rewards, and other packages on the Travala.com ecosystem.

Ultimately, since its inception in 2017, Travala tasks itself as a firm that brings the travel industry transparent pricing and innovation. What’s more, deliver enhanced security and effective stakeholder interaction.

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On a final note, the AVA token saw a 3.35% increase in the last 24 hours. Travala’s circulating supply is at 52,923,082 AVA and a Total supply of 61,383,832 AVA at press time.

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Tether fires back against report it is using reserves for investments and making crypto-backed loans

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Tether, the largest stablecoin issuer by market capitalization, has refuted the details of a Bloomberg story on its reserves holdings.

In an Oct. 7 report, Bloomberg journalist Zeke Faux made numerous claims against Tether, including that its chief financial officer Giancarlo Devasini has used the company’s reserves to make investments, seemingly contradicting Tether’s public position that the holdings were fully backed at all times. In addition, Faux alleges that Tether has invested in Chinese firms and issued crypto-backed loans “worth billions of dollars.” According to the report, he was only able to confirm one bank in the Bahamas was working directly with Tether.

“Tether still hasn’t disclosed where it’s keeping its money,” said Faux. “If Devasini is taking enough risk to earn even a 1% return on Tether’s entire reserves, that would give him and his partners a $690 million annual profit. But if those loans fail, even a small percentage of them, one Tether would become worth less than $1.”

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Tether called the report a “tired attempt” to undermine the company based on “innuendo and misinformation.” The stablecoin issuer challenged the credibility of Faux’s sources as an attempt “to discredit Giancarlo Devasini and Tether’s executives” and continued to claim its USDT tokens are “fully backed,” citing its quarterly assurance reports.

In February, Tether and Bitfinex agreed to pay New York state $18.5 million in damages and provide extensive reports on its finances as part of a settlement with the New York Attorney General’s Office — the most recent audit was filed with information reported as of June 30. Authorities had claimed Tether misrepresented the degree to which its USDT tokens were backed by fiat collateral.

The Bloomberg report comes as many speculate whether China’s second-largest property developer, Evergrande Group, will default on $300 billion in debts. According to Faux, Tether denied holding any debt from Evergrande but would not confirm whether it held commercial paper from other Chinese firms.

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