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A U.S. probe into Tether is homing in on whether executives behind the digital token committed bank fraud, a potential criminal case that would have broad implications for the cryptocurrency market, Bloomberg News reported. Tether’s pivotal role in the crypto ecosystem is now well known because the token is widely used to trade bitcoin. But the Justice Department investigation is focused on conduct that occurred years ago, when Tether was in its more nascent stages. Specifically, federal prosecutors are scrutinizing whether Tether concealed from banks that transactions were linked to crypto, said three people with direct knowledge of the matter who asked not to be named because the probe is confidential. Criminal charges would mark one of the most significant developments in the U.S. government’s crackdown on virtual currencies. That’s because Tether is by far the most popular stablecoin — tokens designed to be immune to wild price swings, making them ideal for buying and selling more volatile coins. The token’s importance to the market is clear: Tethers in circulation are worth about US$62 billion and they underpin more than half of all Bitcoin trades.

The single biggest ransomware attack yet continued to bite Monday as more details emerged on how a Russia-linked gang breached an exploited software company: The criminals essentially used a tool that helps protect against malware to spread it globally, the Associated Press reported. Thousands of organizations — largely firms that remotely manage the IT infrastructure of others — were infected in at least 17 countries in Friday’s assault. Kaseya, whose product was exploited, said yesterday that they include several just returning to work. Because the attack by the notorious REvil gang came just as a long Fourth of July weekend began, many more victims were expected to learn their fate when they return to the office Tuesday. REvil is best known for extorting $11 million from meat processor JBS last month. Security researchers said its ability to evade anti-malware safeguards in this attack and its apparent exploitation of a previously unknown vulnerability on Kaseya servers reflect the growing financial muscle of REvil and a few dozen other top ransomware gangs whose success helps them afford the best digital burglary wares. Such criminals infiltrate networks and paralyze them by scrambling data and extorting their victims.

A Kansas City payday loan business owner was sentenced yesterday in federal court to spend one year plus a day in prison after pleading guilty to filing a false bankruptcy claim as he sought to offload $7.5 million in debt, the Kansas City Star reported. Del Hodges Kimball pleaded guilty in January to a single count of bankruptcy fraud. In addition to his prison time, Kimball is ordered to pay more than $900,000 in restitution, the U.S. Attorney’s Office for the Western District of Missouri said. Authorities alleged that he spent two years lying about his financial position while holding on to assets he secretly owned to avoid paying back his lenders. In his plea, Kimball admitted his scheme was concocted to defraud the bankruptcy court by concealing assets, bank accounts and making false statements, federal prosecutors said. Acting U.S. Attorney Teresa Moore said the bankruptcy system Kimball admitted to exploiting relies on the honesty, openness and accuracy of those in debt seeking a fresh start. The criminal charges were related to a personal bankruptcy case Kimball brought in 2015. Kimball and payday loan company LTS Management, which he co-owned, were forced into bankruptcy by creditors claiming to be owed millions of dollars from investments into payday lending. In 2017, a bankruptcy trustee accused Kimball of concealing assets, bank accounts and income from his bankruptcy disclosures. Those omissions, according to the trustee, included his sale of a warehouse for nearly $1 million, the sale of three cars for more than $120,000, eight wrist watches worth more than $29,000 and a painting by Rolling Stones guitarist Ronnie Wood. All the while, Kimball claimed he lost millions of dollars in 2013 and 2014 while he actually had a gross income of nearly $160,000 in 2013 and more than $213,000 in 2014, federal prosecutors said.