The New York Attorney General (NYAG) anticipates the handover of loan documents relating to an alleged $850 million cover-up will be completed in “the coming weeks.”
The NYAG also noted the timeline for documents to be handed over would come after a deadline, previously mediated by the court, that once again ordered the crypto companies to hand over documents outlining their financial relationship.
As such, the NYAG seeks in the letter to extend an injunction, which bars Tether from loaning Bitfinex any further funds, to Jan. 15, 2021. The date has previously been extended on multiple occasions and is again expected to expire this week before the documents are provided.
The NYAG has alleged that Bitfinex attempted to cover up the loss of $850 million in funds held on behalf of customers via payment processor Crypto Capital, and that it secretly borrowed the shortfall from sister firm Tether’s reserves. Tether issues the USDT stablecoin, which now has a market capitalization of close to $20 billion, according to markets data site CoinGecko.
Counsel for the crypto companies previously argued the document production order was too broad. The NYAG’s office argued otherwise claiming Bitfinex’s attempts to delay the then 17-month-old order “must stop.”
The operators of Crypto Capital were indicted in 2019, including ex-Minnesota Vikings owner Reginald Fowler, accused of stashing funds over a global network of accounts at 56 different banks.
Bitfinex has filed for multiple subpoenas in an attempt to recover the nearly $1 billion it lost.