4 ms·
eeeeeh I dunno 1) FSS is not an accounting firm and did not perform the above review and confirmations using Generally Accepted Accounting Principles. 2) Th
by devilmoon 8y ago
eeeeeh I dunno
1) FSS is not an accounting firm and did not perform the above review and confirmations using Generally
Accepted Accounting Principles.
2) The above confirmation of bank and tether balances should not be construed as the results of an
audit and were not conducted in accordance with Generally Accepted Auditing Standards.
3) FSS makes no representation regarding the sufficiency of the information provided to FSS and all
inquiries made by FSS have been directed to the Client and/or third party personnel responsible for
maintaining such information, and the data has been obtained from the Client and/or third party
personnel responsible for maintaining such information.
4) FSS procedures performed are not for the purpose of providing assurance and are limited to the
findings listed above as of June 1st, 2018, Close of Business. FSS has not performed any procedures or
made any conclusions for activity prior to or subsequent to June 1st, 2018, Close of Business.
5) FSS did not, as part of the Engagement, arrive at any conclusions as to Tether’s compliance with
applicable laws and regulations in any jurisdiction.
6) FSS has assumed, without further inquiry, that the bank personnel providing the confirmations were
duly authorized to provide such confirmations, and that the confirmations were correct.
- TAForObvReasons 8y ago7) FSS did not actually verify the liabilities: > In conjunction with receiving the above balance information, FSS requested the Chief Financial Officer and the General Counsel of Tether to certify, by sworn statement, the amount of fully-backed USD Tethers that were in circulation as of the close of business on June 1st, 2018. Based on the numerous downvotes, it seems many people didn't actually read the PDF in question. The quote is directly from the report and at no point does FSS claim they verified the USDT half of the claims, only that bank accounts on a particular day held a specified dollar amount.
- vorpalhex 8y agoYou didn't counter the point. An Audit isn't some pinky swear. It requires an external accountant to review not only the account balance but how it got there.
- ceejayoz 8y agoPlus "who else might have claims on this".
- ttul 8y agoAnd... where did it come from...
- TAForObvReasons 8y ago... that was a quote directly from the PDF. All FSS actually reviewed was the bank balances. The USDT side was based on a sworn statement from Tether, which calls the whole analysis into question.
- deleted 8y ago[deleted]
- ac29 8y ago"The above confirmation of bank and tether balances should not be construed as the results of an audit and were not conducted in accordance with Generally Accepted Auditing Standards." There was no audit.
- ttul 8y ago7) Who’s to say that the folks at Tether haven’t pledged all that cash as collateral against enormous loans?
- ceejayoz 8y agoOr borrowed it from Bitfinex's customers' holdings before engaging a consulting firm to check their balances.
- ttul 8y agoOooh even better
- gvhst 8y agoWhile I am not ruling out any shenanigans (and would only really trust an audit from a big 4 firm, if that), the report says that their cash is unencumbered. From investopedia [1], "Creditors do not have any claims to assets that are unencumbered, as there are no associated debts relating specifically to the assets." [1]: https://www.investopedia.com/terms/u/unencumbered.asp https://www.investopedia.com/terms/u/unencumbered.asp
- ceejayoz 8y agoFrom the memo: > FSS makes no representation regarding the sufficiency of the information provided to FSS and all inquiries made by FSS have been directed to the Client and/or third party personnel responsible for maintaining such information, and the data has been obtained from the Client and/or third party personnel responsible for maintaining such information. In other words, "unencumbered" here means "Tether told us they're unencumbered".
- devilmoon 8y agoI work for a big 4 although not as an auditor. Do not trust audits by big 4 firms.
- andrewla 8y ago"Borrowed" might be strong. We don't know how strong the relationship between these companies is. One possibility is that Bitfinex wants to allow customers to immediately withdraw any USD deposits to other exchanges that accept Tether-USD. If that is the case, then effectively all deposits into Bitfinex are immediately "sold" to Tether in exchange for Tether-USD. That would mean that Bitfinex does not have any USD at all. Therefore the balance of USD in Tether's bank accounts would include all Bitfinex deposits. Except for the opacity involved, nothing here would actually be misleading or obviously unethical; whether it is illegal is another question.