Cartier Jewelry Heir Arrested for Laundering Drug Money with Stablecoin Tether (USDT)
  • The U.S. Department of Justice has indicted Maximilien de Hoop Cartier for his alleged role in laundering drug trafficking proceeds using Tether (USDT).
  • The indictment details how Cartier used shell companies to defraud financial institutions into believing he was a software and technology company.

U.S. Department of Justice (DoJ) I was arrested Maximilien de Hoop Cartier, the direct heir to the Cartier jewelery empire, has been indicted on charges of money laundering and conspiracy. The arrest came after Cartier was suspected of being involved in a scheme to launder drug trafficking proceeds using the cryptocurrency Tether (USDT).

Cartier and his associates, including five Colombians, reportedly attempted to import 100 kilograms of cocaine and then laundered large sums of money, primarily through over-the-counter USDT transactions. Despite successfully laundering 14.5 million USDT before his arrest, law enforcement intervened and Cartier was detained in a facility in Miami, while his co-conspirators were imprisoned in a Colombian prison.

The indictment details how Cartier used shell companies to defraud financial institutions into believing he was a software and technology company. He allegedly used these fronts to conduct unauthorized transfers by laundering hundreds of millions in criminal proceeds in convertible currencies such as USDT, dollars, and pesos.

International operation revealed

Although Cartier primarily resided in France and had Argentine citizenship, his criminal activity extended beyond borders, demonstrating the international reach of his money laundering operations. He is also the heir to Louis Francis Cartier, a jeweler who founded an expensive company in Paris in 1847 and was part owner of the Patagonian wine, beer and bottled water company Patagonia.

USDT is a stablecoin pegged to the US dollar that has gained notoriety for its role in facilitating illicit financial transactions. While Tether’s parent company has consistently reassured the public of its efforts to combat the criminal use of USDT, cases like the Cartier indictment highlight the challenges digital currencies pose to law enforcement operations. The inherent anonymity and ease of transfer of cryptocurrencies pose unique obstacles to detecting and preventing illicit financial activity.

Impact on the industry and legal responses

The indictment follows Tether’s May 2 announcement that it plans to build a surveillance tool that can track movements in the stablecoin’s secondary collaboration The effort, in collaboration with blockchain intelligence firm Chainalysis, aimed to track suspicious transactions involving stablecoins that could be linked to terrorist financing. Additionally, this comes on the heels of increased levels of oversight by Tether regulators due to concerns over Tether’s use in facilitating cross-border transactions, particularly in sanctioned regions.

The partnership with Chainalies provides Tether with some of the most cutting-edge tools to identify sanctioned entity transactions and monitor the activities of key token holders. According to these reports, entities in Venezuela and Russia have been found to be using Tether for illegal activities. Tether recently pledged to freeze assets tied to Venezuela’s state oil company PDVSA, which is on the run from sanctions.

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