Home News Exchange New York Attorney General Calls Out Bitfinex Over Alleged Cover-up of $850M;...

New York Attorney General Calls Out Bitfinex Over Alleged Cover-up of $850M; Exchange Responds

April 26, 2019 14:02
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Merely months after the Tether-Bitfinex controversy, the exchange has come under fire once again. Recently, the New York Attorney General (AG) had accused the exchange of an alleged cover up which amounts to nearly $850 million. The company issued a statement regarding this, refuting the allegations.

News portal, Bitcoinist reported that according to the Attorney General’s claims, Bitfinex had reportedly lost $850 million of customer money. This had been sent to, and seized by payment processing firm, Crypto Capital Corp. The allegation goes on to say that Bitfinex used cash reserves from affiliated stablecoin, Tether, to cover the shortfall.

The AG, Letitia James had reported that the ‘loss of funds’ and movement of reserves was not disclosed by operator of either Bitfinex or Tether, iFinex. Apparently, this had led to the exchange had “engaged in a cover-up to hide the apparent loss of $850 million of co-mingled client and corporate funds.”

Bitfinex, however, published a strongly worded post calling out the office of the Attorney General for the “false assertions.”

A portion of the post said, “The New York Attorney General’s court filings were written in bad faith and are riddled with false assertions, including as to a purported $850 million “loss” at Crypto Capital. On the contrary, we have been informed that these Crypto Capital amounts are not lost but have been, in fact, seized and safeguarded. We are and have been actively working to exercise our rights and remedies and get those funds released. Sadly, the New York Attorney General’s office seems to be intent on undermining those efforts to the detriment of our customers.”

It added that Tether and Bitfinex has always been very co-operative with the office of AG as well as with regulators and further stated that the AG ought to aid and support the exchange’s recovery efforts.

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