US Prosecutors Want $84.2 Million From a Bank Tied to Tether
The U.S. Department of Justice filed a civil forfeiture complaint on July 15 seeking $84.2 million tied to Capstone Ltd., a Montana payments firm prosecutors say acted as an unlicensed money transmitter for Tether. The funds are held across accounts at Wells Fargo Securities, JPMorgan Chase and two USDT wallets, and prosecutors say Dominica-based EQIBank directed Capstone's movements.
Why It Matters
The seizure targets a large sum connected to payments activity for Tether, a major stablecoin issuer, and threatens a Dominica-licensed bank that says losing the funds could push it toward liquidation. The action escalates long-running regulatory and enforcement scrutiny of how crypto firms move money.
Key Facts
- Complaint filed: July 15, U.S. Department of Justice, Eastern District of California (Judge Dale A. Drozd)
- Amount targeted: $84.2 million
- Primary account holding funds: $79.11 million in a Wells Fargo Securities account (Capstone name)
- Other holdings: $2.06 million at JPMorgan Chase; $1.86 million in another Wells Fargo account; just over $1.1 million across two USDT wallets
- Defendant company: Capstone Ltd., Montana-based payments firm
Federal prosecutors have asked a U.S. court to forfeit $84.2 million they say passed through accounts used to process payments for Tether. The civil forfeiture complaint, lodged on July 15 in the Eastern District of California, names Capstone Ltd., a Montana payments processor that the Department of Justice alleges operated as an unlicensed money transmitter in at least six states. The filing says Capstone represented itself to banks as an ordinary IT services company.
Most of the targeted funds—$79.11 million—were in a Wells Fargo Securities account in Capstone's name; additional sums include $2.06 million at JPMorgan Chase, $1.86 million in a separate Wells Fargo account, and slightly more than $1.1 million split across two wallets holding USDT, Tether's stablecoin. Civil forfeiture allows the government to seize assets tied to alleged crimes without a criminal conviction against the owner of the funds.
Prosecutors allege Dominica-licensed EQIBank sat behind Capstone and directed how the processor moved money. EQIBank has warned that losing the roughly $84.2 million—about 80% of the assets it holds—could force the bank into liquidation. Tether confirmed that EQIBank handled its purchase and redemption wire transfers but said it had no knowledge of the conduct alleged in the DOJ complaint, and characterized its exposure as under 0.034% of group assets; Tether reported $187.75 billion in assets at the end of the second quarter.
Capstone's owners, identified in the complaint as Kotaro Shimogori and Mary Jeanne Thompson, are named in the filing and an FBI search warrant was executed at a Sacramento residence. Their attorney told the Financial Times the company denies wrongdoing and hopes to resolve the matter quickly. Capstone and EQIBank have filed innocent-owner defenses contesting the seizure. Under Supplemental Rule G, a claimant has 21 days to respond to the government's complaint once a formal claim is filed.
The forfeiture action continues a pattern of enforcement involving Tether and related firms: in 2021 Tether and Bitfinex settled with the New York Attorney General, acknowledging that USDT was not always fully backed and paying an $18.5 million fine while agreeing to stop trading in New York.
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