(2019)
NYAG v. Bitfinex and Tether
Year
2019
Criminal or Civil
Civil (Regulatory Enforcement – Martin Act)
Year Resolved
2021
Jurisdiction (Court/State)
New York State – Office of the Attorney General (Martin Act enforcement)
Filed By
New York Attorney General (Letitia James)
Penalty/Fine (USD)
$18.5 million
Lawsuit Overview
The New York Attorney General sued Bitfinex and Tether for falsely claiming Tether was fully backed by U.S. dollars, concealing $850 million in losses, and operating illegally in New York. The companies agreed to halt trading with New Yorkers, pay an $18.5 million fine, and submit to mandatory reporting on their operations.
Category
Stablecoin Misrepresentation, Illegal Trading, Investor Fraud
Notable Individuals Involved
Letitia James (NY Attorney General)
iFinex Inc. (Operator of Bitfinex)
Tether Holdings Limited
Senior Enforcement Counsel John D. Castiglione
Investor Loss Estimate
Approximately $850 million in hidden losses; specific retail investor losses not detailed but implied to be significant due to misrepresentation and commingled funds
Final Outcome
Settlement – Bitfinex and Tether banned from operating in New York, required to submit periodic transparency reports and public asset disclosures
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