Bitfinex May Face Criminal Investigations in U.S.

Table of Contents

• Bitfinex’s Legal Woes

The sister company of stablecoin Tether, crypto exchange Bitfinex, is facing the possibility of criminal investigations in the United States according to the Department of Justice (DOJ) in a reply to a Freedom of Information Act (FOIA) request shared on Twitter earlier this week. Bitfinex has for a long time been under scrutiny for its actions, and if reports are to be believed, it will be subject to investigations yet again.

The DOJ has since denied a request for information regarding Tether Holdings Limited, its parent company iFinex Inc. and other subsidiaries, including Bitfinex, citing Exemption 7(A) of the FOAI Guide. The exemption precludes the disclosure of:

Records or information compiled for law enforcement purposes, but only to the extent that production of such law enforcement records or information ... could reasonably be expected to interfere with enforcement proceedings.

The individual who filed the request in February 2022 is Twitter user oleh86, and according to it, the request itself asked:

Dear Sirs, Pursuant to Freedom of Information Act (FOIA), 5 U.S.C. § 552, I am hereby requesting any and all information in the possession of the US Department of Justice on jointly and severally TETHER HOLDINGS LIMITED, TETHER LIMITED, TETHER INTERNATIONAL LIMITED, TETHER OPERATIONS LIMITED, IFINEX INC., BFXNA INC., and BFXWW INC.

The denial of the request read as follows:

Looks like #Bitfinex is in legal proceedings in the US - the DOJ denied my FOIA request on grounds of Section b(7)(A) aimed at preventing pretrial publicity that could impair a court proceeding.

The exemption essentially prevents the public from getting information about the legal enforcement of the company. It is done to ensure that people with information do not try and tamper with evidence or try anything that would unduly influence the proceedings.

Bitfinex’s Legal Woes

Bitfinex and sister company Tether has been facing heavy scrutiny from legal entities for a long time. In 2021, Bitfinex and Tether had to pay $42.5 million in fines to the U.S. Commodity Futures Trading Commission (CFTC) in civil monetary penalties.

Bitfinex has also faced multiple investigations from civil and criminal entities in the U.S. regarding whether stablecoin issues Tether, was being truthful about the state of its reserves.

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.