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The International Consortium of Investigative Journalists reported on August 31, 2026, that Tether sold USDT directly to companies later identified as laundering vehicles for North Korean hackers and the Sinaloa Cartel, citing leaked customer records from 2019 and 2020.
The findings are significant because Tether has repeatedly said that customers who purchase USDT directly from the company undergo rigorous due diligence, including checks on their sources of funds, sanctions exposure and potential connections to illicit activity.
The leaked records provide a rare look at who was buying newly issued USDT from Tether during one of the stablecoin’s most important periods of growth.
The Tether records examined by ICIJ cover transactions from 2019 and 2020, when USDT’s circulation increased dramatically.
During that period, the supply of USDT grew from less than $2 billion to more than $20 billion.
The documents identify customers who purchased USDT directly from Tether, rather than obtaining the stablecoin later through cryptocurrency exchanges or other market participants.
That distinction is central to the ICIJ investigation.
Tether has long argued that there is an important difference between an illicit actor obtaining USDT somewhere in the secondary market and purchasing newly issued tokens directly from Tether.
In a 2023 letter to U.S. lawmakers, Tether CEO Paolo Ardoino said the company’s customer screening included practices comparable to those used by sophisticated financial institutions.
Those procedures include examining customers’ sources of funds, sanctions lists and information potentially connecting them to illicit activity.
However, the ICIJ investigation identified several direct customers whose activities later came under scrutiny from law enforcement and financial regulators.
The records also show hundreds of millions of dollars in USDT purchases involving companies registered in offshore jurisdictions including the Cayman Islands, British Virgin Islands, Seychelles and Hong Kong.
Among the most significant findings are transactions involving two Hong Kong companies, Lucky DC Trade Pty Limited and Tomorrow Good Limited.
According to ICIJ, the companies collectively purchased more than $100 million worth of USDT directly from Tether.
Lucky DC bought nearly $47 million in USDT in 2020.
Its director, Cheng Hung Man, was later indicted by a U.S. federal grand jury in 2022 for allegedly laundering money for North Korea.
Authorities from 11 countries subsequently identified Lucky DC and Tomorrow Good as part of a network allegedly used to access banking services and launder cryptocurrency proceeds for a North Korean hacking and ransomware operation.
Tomorrow Good purchased more than $66 million in USDT directly from Tether in 2019, according to the records.
The company also appeared in a 2024 U.S. indictment involving members of the Sinaloa Cartel. The indictment described the use of USDT in laundering proceeds connected to the Mexican drug-trafficking organization.
The timeline is crucial.
The Tether purchases took place years before several of the criminal allegations became public. The records therefore do not establish that Tether knowingly sold USDT to criminals.
Instead, they raise questions about whether Tether’s customer-vetting systems were capable of identifying potential risks before large amounts of USDT were issued.
Anti-money-laundering expert Alison Jimenez told ICIJ that effective due diligence is intended to prevent financial institutions from onboarding customers who later turn out to be criminals.
The leaked records also reveal the scale of Tether’s dealings with some of crypto’s biggest companies.
Alameda Research, the trading firm co-founded by former FTX CEO Sam Bankman-Fried, purchased more than 4.1 billion USDT directly from Tether during the period covered by the documents.
Alameda operated as a crypto trading firm, venture capital investor and market maker and played a central role in the FTX ecosystem.
Bankman-Fried is serving a 25-year federal prison sentence after being convicted of crimes connected to the collapse of FTX and the misuse of customer funds.
The enormous volume of Alameda’s purchases highlights the role direct Tether sales played in putting USDT into wider circulation during the stablecoin’s rapid expansion.
Another major buyer identified in the records was Justin Sun, founder of the Tron blockchain.
Sun purchased more than $214 million worth of USDT directly from Tether between April 2019 and March 2020.
Sun later became one of the most prominent figures in the cryptocurrency industry. The U.S. Securities and Exchange Commission previously accused him of selling unregistered securities and manipulating the market for TRX.
The SEC later dismissed its claims against Sun, while one of his companies agreed to pay a $10 million penalty.
The ICIJ records identify several other customers whose activities later attracted regulatory or law-enforcement attention.
A Cayman Islands company called AP Capital Investment Limited purchased approximately $23.7 million in USDT directly from Tether in 2020.
The company was later cited in a Vietnamese case involving an illicit USDT trading scheme.
Chris Humphries, a Cayman Islands attorney representing AP Capital, told ICIJ that the case concerning the company was suspended because of insufficient evidence and that the matter related to the conduct of certain local individuals.
Another customer, Ianis Antropenko, was indicted in the United States in 2024 over ransomware attacks targeting healthcare and educational institutions.
Antropenko later pleaded guilty and agreed to forfeit approximately $1.4 million in USDT, along with other cryptocurrencies.
The records also show that a company owned by Chinese crypto trader and Bitfinex shareholder Zhao Dong received approximately $1.5 million in USDT over eight days in 2020.
Chinese authorities later arrested Zhao on suspicion of money laundering. He was subsequently convicted and imprisoned.
Crypto lender Nexo Capital also appears among Tether’s customers.
In 2023, Nexo agreed to pay a combined $45 million in penalties to U.S. regulators. A Nexo spokesperson told ICIJ that the regulatory matters were concluded in 2023 and had no connection to the company’s purchases of Tether tokens.
The ICIJ investigation went beyond the leaked sales records.
Because the documents did not contain the blockchain wallet addresses used by Tether’s customers, investigators matched transaction dates and dollar amounts against publicly available blockchain data.
That allowed ICIJ to connect some of the sales to specific wallets.
One of the clearest examples involves Nikita Krasnov.
Krasnov purchased approximately $1.16 million worth of newly issued USDT from Tether in 2020.
More than four years later, U.S. authorities sanctioned Krasnov over his alleged involvement in an extensive sanctions-evasion operation serving Russian elites.
ICIJ’s blockchain analysis found that one wallet used by Krasnov to receive USDT from Tether was later identified by the U.S. Treasury Department as a key money-laundering account.
The investigation also identified two other Russian customers who collectively purchased more than $57 million worth of USDT from Tether.
Those customers used another wallet previously used by Krasnov.
Paul Sibenik of Cryptoforensic Investigators, who reviewed the blockchain data for ICIJ, said the shared wallet suggested the customers were part of the same financial network.
Krasnov could not be reached for comment.
The investigation does not prove that Tether knowingly facilitated money laundering.
That distinction is important because several of the customers were connected to criminal allegations only after their Tether purchases occurred.
But the records raise questions about the effectiveness of Tether’s historical compliance procedures, particularly when customers were purchasing millions of dollars worth of USDT directly from the issuer.
Tether has strongly emphasized its cooperation with law enforcement.
The company says it has voluntarily assisted investigations involving illicit cryptocurrency flows and helped authorities freeze billions of dollars worth of USDT linked to criminal activity.
Government investigators and blockchain analysts have also praised Tether’s responsiveness when law enforcement agencies seek assistance tracing and freezing illicit funds.
The ICIJ findings, however, focus on an earlier stage of that process: who was allowed to purchase USDT directly from Tether in the first place?
That distinction could become increasingly important as regulators and governments around the world scrutinize stablecoins and their role in global finance.
For Tether, the question is no longer simply whether criminals use USDT.
The bigger compliance question is whether the company’s customer-vetting systems were effective enough to identify high-risk customers before newly issued tokens entered the cryptocurrency market.
Tether did not respond to ICIJ’s requests for comment on the investigation.
The company has previously defended its compliance controls and highlighted its extensive cooperation with law enforcement.
The newly revealed records nevertheless provide one of the clearest public windows yet into Tether’s early customer base and could intensify scrutiny of how the world’s largest stablecoin issuer handled customer due diligence during its explosive growth.
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