Brazilian authorities, with Tether’s assistance, just pulled off a major crackdown on a sophisticated money laundering network. The stablecoin giant’s real-time tracking tools led to freezing R$32 million in USDT, exposing how crypto forensics outpaces traditional finance in hunting down dirty money.
On July 18, USDT issuer Tether announced its role in assisting Brazilian law enforcement to dismantle a sprawling cyber fraud operation, codenamed Operation Magna Fraus.
According to the press release, the São Paulo Public Prosecutor’s Office and Federal Police targeted a criminal syndicate that siphoned funds through Brazil’s PIX payment system before funneling them into USDT. Over two days of raids across Goiás and Pará, authorities seized R5.5millionincryptoand∗∗froze∗∗anotherR32 million ($5.7 million) in Tether, marking one of the country’s largest stablecoin-related busts to date.
Blockchain Transparency: A Game Changer in Crime Fighting
In addition to the R$32 million in USDT they froze, Brazilian authorities also uncovered a private key linked to stolen crypto assets—a rare find in such operations. The key granted access to wallets holding illicit funds, and they promptly transferred these funds into state custody.
According to São Paulo’s Public Prosecutor’s Office, they will liquidate these assets and place them under a judicial account managed by the Criminal Court Specialized in Tax Crimes, Criminal Organizations, and Money Laundering. This mechanism ensures any recovered value remains under the oversight of Brazil’s criminal justice system as proceedings move forward.
Tether’s involvement in Operation Magna Fraus is far from an outlier. Over the past year alone, the company has become a go-to ally for law enforcement agencies cracking down on illicit finance.
In June 2024, the U.S. Department of Justice credited Tether with helping seize $225 million in USDT tied to a high-profile fraud case. Months later, it aided the U.S. Secret Service in freezing $23 million linked to transactions on Garantex, a Russian exchange blacklisted for sanctions evasion, and another $9 million tied to the Bybit exchange hack.
To date, Tether has blocked over 5,000 wallets, with more than half of this figure resulting from collaboration with U.S. authorities, signaling a seismic shift in how stablecoins are policed.
