Bitcoin Global News (BGN)
June 27, 2018 -- ADVFN Crypto NewsWire -- Tether released a
report last week to shut down scrutiny that the token is not
actually fully backed by USD. The report by Freeh Sporkin &
Sullivan confirms funds, but there are disclaimers in the
memorandum that leaves the confirmation up to interpretation. The
choice by Tether to use this organization for an audit raises
suspicions as well.
Not a True
Audit
Freeh Sporkin & Sullivan is a
law firm co-founded by former FBI director Louis Freeh. Because of
this the memorandum does not constitute an audit since it was not
conducted by an accounting firm. Stuart Hoegner, lead legal advisor
to Tether:
“The barriers to getting audited
are simply too big to overcome right now, and not just for us. The
cryptocurrency market looks too nascent for large accounting firms
to consider taking on clients who offer digital coins.”
Conflict of
Interest?
Eugene R. Sullivan, Senior Partner
at Freeh Sporkin & Sullivan, is also on Board of Advisors of
Noble Bank, which has been providing banking for both Bitfinex and
Tether. Tether’s co-founder Brock Pierce, another a co-founder of
Noble Bank in 2014, is also a partner of Sunlot Holdings. One of
the advisors to Sunlot Holdings is Louis Freeh of Freeh Sporkin
& Sullivan.
The U.S. Commodity Futures Trading
Commission (CFTC) subpoenaed Tether and Bitfinex in December 2017
however no further information has come to the fore.
Confirmed Reserves, Not
Liabilities
The memorandum confirms that Tether
had the corresponding reserves in their bank accounts on one data,
specifically (June 1). According to the report, the date was picked
without Tether’s knowledge. However, it does not examine Tether’s
liabilities. A disclaimer in the memorandum states that “FSS
procedures performed are not for the purpose of providing
assurance.”
Other Stable Coin
Options
TrueUSD publishes independent attestation
performed by accounting firm Cohen & Company on the bank
accounts holding the collateral for TrueUSD.
Tether’s September 2017
Audit
The audit states that the money was
stored in the account held in name of trustee. There was no
confirmation that Tether had an enforceable agreement with the
trustee, and the bank where the funds were held was removed from
the document. Because of these, Tether ended the partnership with
that auditing firm (Friedman LLP).
By: BGN Editorial Staff
News:
Tether
(USDT)
Cryptocurrency
TrueUSD
(TUSD)
