The U.S. Department of Justice has seized $84.2 million from accounts tied to payment processor Capstone Ltd., which prosecutors accuse of operating an unlicensed money-transmitting business. Capstone allegedly moved hundreds of millions of dollars for Tether and Bitfinex through Dominica-licensed EQIBank. EQIBank warns it faces liquidation as the seizure froze 80% of its assets. Tether downplays the impact, stating its exposure is under 0.034% of its assets, while Capstone denies wrongdoing.
Details of the asset seizure
- ▪The U.S. Department of Justice filed a civil forfeiture complaint on July 15, 2026, in the Eastern District of California to permanently claim approximately $84.2 million in accounts and digital wallets tied to Capstone Ltd.
- ▪Federal authorities seized $79.11 million from a Wells Fargo Securities account, $1.86 million from a Wells Fargo Bank account, $2.06 million from a JPMorgan Chase account, and 1.18 million USDT from two digital wallets linked to Capstone Ltd.
Seizure's impact on EQIBank
- ▪EQIBank co-founder Christopher Burke stated in a court filing that the funds seized from Capstone Ltd.'s accounts represent roughly 80% of the bank's financial assets and that the bank cannot operate much longer without them
- ▪U.S. District Judge Dale A. Drozd denied EQIBank's request to recover the funds seized from Capstone Ltd.'s accounts on July 16, 2026, ruling that the court lacked equitable jurisdiction once prosecutors filed the civil forfeiture case
- ▪EQIBank filed a motion on June 29, 2026, in the U.S. District Court for the Eastern District of California seeking the return of approximately $89 million seized from Capstone Ltd.'s accounts, which the bank argues largely belong to its customers
- ▪Dominica's Financial Services Unit placed EQIBank under enhanced supervision on June 5, 2026, which EQIBank co-founder Christopher Burke described as a preliminary step for the regulator to take over and liquidate the bank
Allegations and response from Capstone
- ▪U.S. prosecutors allege Capstone Ltd. operated as an unlicensed money transmitter in at least six states, presenting itself to banks as an ordinary IT services company to gain access to the U.S. financial system
- ▪Court documents show that more than $700 million passed through a Capstone Ltd. account between March and December 2025, with $337 million paid out, of which nearly two-thirds went to individuals and entities on behalf of Tether and Bitfinex
- ▪Capstone Ltd. owners Kotaro Shimogori and Mary Jeanne Thompson deny any wrongdoing and plan to file a motion to dismiss the government's civil asset forfeiture complaint
Alleged impersonation fraud scheme
- ▪An alleged FBI-impersonation fraud scheme involved a Capstone Ltd. bank account at JPMorgan Chase holding just over $2 million, with no suggestion that Tether, Bitfinex, or EQIBank were aware of the scheme
- ▪The Department of Justice alleges Capstone Ltd. facilitated an impersonation fraud scheme where scammers posing as FBI agents coerced elderly victims into depositing cash that Capstone then converted into USDT
Response from Tether and Bitfinex
- ▪A Tether spokesperson stated that the company's exposure to EQIBank represents less than 0.034% of the group's total assets, which equates to less than approximately $64 million of Tether's $187.75 billion in assets
- ▪Tether and Bitfinex stated they are customers of EQIBank but had no knowledge of the fraudulent FBI-impersonation conduct by Capstone Ltd. alleged by the Department of Justice
Debatable claims
- ▪The US seizure of Capstone's accounts goes too far by threatening EQIBank's survival
- ▪Tether's reliance on offshore banks poses an unacceptable risk to USDT's stability
- ▪EQIBank bears responsibility for the unlicensed activities of its payment processor
- ▪Seizing Capstone's assets before a criminal conviction is an abuse of federal power
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