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[SITUATION] · [QUIET] · [BUSINESS]

3 clusters · 25 sources · 3 days · First seen · Last updated

U.S. asset seizure involving Capstone Ltd. and EQIBank

Overview

The U.S. Department of Justice has filed a civil forfeiture complaint to seize approximately $84.2 million in assets linked to Capstone Ltd., a Montana-based payments firm. Prosecutors allege Capstone operated as an unlicensed money transmitter in at least six states and misrepresented itself to major financial institutions, including Wells Fargo and JPMorgan Chase, as an IT services company to facilitate international transfers.

Court documents reveal that over $700 million passed through a single Wells Fargo account belonging to Capstone between March and December. Prosecutors claim Capstone facilitated the conversion of cash from impersonation fraud schemes targeting elderly citizens into stablecoins. Investigations indicate Capstone acted as a conduit for cryptocurrency companies Tether and Bitfinex through EQIBank, a digital bank licensed in Dominica.

The seizure has significant implications for EQIBank, which reported that the frozen funds represent roughly 80% of its total monetary holdings, warning that the loss could lead to formal liquidation proceedings. A federal judge in the Eastern District of California has already denied EQIBank’s motion to recover the property.

Tether has disclosed that its exposure to EQIBank is approximately $64 million, which represents less than 0.034% of its total group assets. Tether emphasized that the seizure will not impact the stability of USDT, though it has not provided a direct link between its EQIBank exposure and USDT reserves. Tether and Bitfinex have denied any knowledge of Capstone’s alleged fraudulent conduct, stating they were merely customers of EQIBank. Despite the potential counterparty risk, major cryptocurrencies like Bitcoin and Ethereum have remained relatively stable.

Entities

EQIBank · Tether · Capstone Ltd. · US government · U.S. Department of Justice

Claims

What the coverage asserts, and how many sources carry each claim.

Timeline

  1. [BUSINESS] 3 sources
    Tether reports minimal exposure to EQIBank after US asset seizure

    Tether reports minimal exposure to EQIBank, estimated at $64 million, following an $89 million US asset seizure involving Capstone Limited.

  2. [BUSINESS] 17 sources
    Capstone Ltd. faces $84.2 million DOJ asset seizure

    The U.S. DOJ is seeking to seize $84.2 million from Capstone Ltd., alleging the firm acted as an unlicensed money transmitter for Tether and Bitfinex while misrepresenting itself to U.S. banks.

  3. [BUSINESS] 8 sources
    Tether faces exposure as EQIBank faces liquidation risk

    Tether faces exposure to EQIBank, an offshore lender facing liquidation after U.S. authorities seized $89 million in assets linked to a payment provider.

Sources

ad-hoc-news.de · blocktempo.com · blogspan.net · coinpedia.org · criptotendencias.com · cryptobriefing.com · cryptonomist.ch · cryptopolitan.com · cryptoslate.com · decrypt.co · ethnews.com · futurism.com · heartbeats.jp · journalducoin.com · klamm.de · kriptoworld.hu · mycryptoparadise.com · news.bitcoin.com · phocapblockchain.net · pymnts.com · techblog.gr · technologyreview.de · tokenpost.com · tronweekly.com · unchainedcrypto.com

This summary has been updated 2 times: see revision history