Stablecoin Issuer Circle Denies Claims of Facilitating Terrorist Financing and Ties Justin Sun

Circle, the second-largest stablecoin issuer by market capitalization, has vehemently refuted claims of its involvement in terrorist financing. Earlier this week, the international regulatory agency Campaign for Accountability (CA) accused Circle of supporting funds transfer to an illicit group.

According to the CA report, Circle was accused of facilitating the transfer of funds between Hamas and Hezbollah. After analyzing the report from Israeli law enforcers that traced the transfer of crypto assets worth $93 million from 26 digital wallets to external wallets owned by Palestinian Islamic Jihad, the CA noted that a measurable amount of USDC was among the assets seized by the intelligence unit.

Circle Accused of Illicit Financing

The CA observed that USDC, USDT, Bitcoin, and Ether were among the assets confiscated by the Israeli police.

As the legal tiff between Circle and the US regulators mounted, the stablecoin issuer, led by Chief Strategy Officer Dante Disparte, formulated a well-detailed report disputing the CA allegation.

In the 13-page report shared with Senate Banking Committee Chairman Sherrod Brown and Massachusetts Senator Elizabeth Warren, Circle denies claims of its involvement in terrorist financing.

Disparte underlined that Circle has never supported the transfer of funds to Hamas. Responding to the CA claims, Disparte admitted that approximately $160 USDC was linked to the 26 wallets under investigation. He added that the blockchain report shows that the illicit group acquired no funds from Circle.

Contrary to the claims, Disparte admitted that Circle has remained at the forefront to support the regulators to bring down criminals in the financial sector. He confessed that Circle has collaborated with global regulators and law enforcement to combat financial crime.

Circle Denies Claims on its Involvement in Illicit Fund Transfer

Updating the X community, Disparte blamed the CA for citing the report directly without doing due diligence to confirm the accuracy and reliability of the information. The official admitted that since 2013, Circle has always maintained high regulatory standards and aligned its business practices in compliance with the law.

The executive stated that the stablecoin issuer operations conform with the Bank of Secrecy Act and imposed measures to address money laundering activities. Disparte confessed that Circle has supported the implementation of rules to strengthen the existing AML requirements.

Citing a draft bill presented by Senator Warren in partnership with bipartisan groups, Disparte affirmed that Circle seeks to address financial crimes.

From its pivotal role in addressing financial crime, Circle gained global recognition and was awarded by the US Secret Service for its extensive support in tracking and convicting scammers and fraudsters.

Involvement of Crypto Firms in Terrorist Funding

In September, the US Secret Service acknowledged Circle’s support in identifying and reporting the fraudulent schemes and pig-butchering scams in crypto industry. To attain this remarkable achievement, Circle has embraced a friendly compliance culture to ensure the company meets the regulatory requirements.

The official admitted that Circle core players worked with the CIA, Treasury and Justice Department, and law enforcement units for years to combat financial crime. Remarkably, the government agency recognized Circle’s assistance in recovering millions of dollars.

Based on Circle’s successful operation to address crypto scams and fraudulent schemes, Disparte labeled the accusation of its involvement in financing terrorists as misleading information. The official described the CA allegations on Circle as replete with errors.

Besides the CA accusation, market critics argued that Circle had a close relationship with TRON and its founder, Justin Sun.

Circle Cut Ties with TRON

Responding to the claims, Disparte stated that Circle has no close ties with either TRON or the crypto investor Justin Sun. He admitted that the Circle team and Sun had established a solid business relationship earlier.

However, the two agreed to part ways at the beginning of this year, and Circle no longer bank Justin Sun. The executive confirmed that the stablecoin issuer suspended all accounts owned by Sun, TRON, and its subsidiary companies in late February.

The decision to terminate accounts tied to Sun and TRON emanated from noncompliance with the Specially Designated Nationals (SDN). Disparate argued that neither TRON nor Sun received the SDN approval from the Office of Foreign Assets Control (OFAC).

The official regretted that TRON Foundation and HTX (formerly Huobi) had been listed on the SDN. Despite the efforts made by Sun in transforming the crypto industry, the actions of the crypto mogul appear to be more controversial following a publication on The Verge.

In September journalist at The Verge media outlet claimed that the Grenadian crypto investor was battling several criminal charges. The report cited information from a former employee who profiled Sun as a lawbreaker.

He was accused of insider trading, market manipulation, money laundering, and wire fraud. Reacting to The Verge publication, Sun described the article as total defamation and threatened to take legal action against the media outlet.

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