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Tether appoints former Bank of Montreal executive as Chief Compliance Officer

Tether, the startup behind “USDT” – a dollar-pegged cryptocurrency, has announced the appointment of former AML Quality Control Manager at the Bank of Montreal, Leonardo Real, as Chief Compliance Officer (CCO).

During his stint at the Bank of Montreal, Real was responsible for establishing best practices, policies, and procedures in line with regulatory requirements to enhance the quality of the bank’s AML investigations. Prior to holding positions at the Bank of Montreal, Real was employed by Bridgeforce Financial, one of Canada’s leading Managing General Agents (MGA).

“I look forward to helping showcase Tether’s commitment to transparency and regulatory compliance within the blockchain and cryptocurrency space…I am looking forward to putting my experience in AML and regulatory compliance in traditional financial institutions to use, to ensure that the Tether project can continue its work disrupting traditional industries,” said Real.

The company has been subject to a lot of allegations and scrutiny in the past couple of months. Most of these were focused on whether the tethers in circulation were fully backed by the US dollar or not.

In an effort to come clean, Tether engaged with Washington-based law firm Freeh, Sporkin & Sullivan LLP (FSS) this year to review bank account documentation and to perform a randomized inspection of the numbers of Tethers in circulation and the corresponding currency reserves. In an official announcement last month, Tether said:

“The FSS report, based on a random date balance inspection and a full review of relevant bank account documentation, confirms that all Tethers in circulation as of June 1, 2018 are fully backed by existing USD reserves.”

In a report, Bloomberg noted that the law firm included a number of disclaimers in its report:

“FSS is not an accounting firm and did not perform the above review and confirmations using Generally Accepted Accounting Principles,” according to its report. “FSS has not performed any procedures or made any conclusions for activity prior to or subsequent to June 1st, 2018, Close of Business.”

It added: “FSS has assumed, without further inquiry, that the bank personnel providing the confirmations were duly authorized to provide such confirmations, and that the confirmations were correct.”

Tether had previously engaged with accounting firm Friedman LLP, which also included such disclaimers in its findings published last September. A source familiar with the matter told Bloomberg that Friedman was subpoenaed by CFTC as part of its Tether investigation.

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