Legal Battle: Powerful Bitfinex Investor Sues Wall Street Journal

A legal battle unfolded when cryptocurrency investor Christopher Harborne sued The Wall Street Journal (WSJ) for defamation. The lawsuit stemmed from a WSJ expose that accused Harborne and his company AML Global Ltd of financial misconduct. Despite corrections made to the article, WSJ faces a reckoning as Harborne seeks to clear his name in court.

Lawsuit Alleges WSJ Misinformation

The lawsuit, filed in a Delaware Superior Court on February 28, targeted an article published by WSJ in March 2023. The article described some alleged illegal activities carried out by Tether and Bitfinex.

The article, titled “Crypto Companies Behind Tether Used Falsified Documents and Shell Companies to Get Bank Accounts,” alleged that Bitfinex and Tether faced banking issues, leading backers like Harborne to create “shadowy intermediaries” and shell companies to remedy the situation.

The publication focused on Harborne’s application for an account at the now-defunct Signature Bank. Tether CEO had tweeted that the WSJ article contained “misinformation and inaccuracies.”

Harborne is a British investor based in Thailand. The investor made his wealth from the aviation fuel business and several investments from cryptocurrency companies. He’s a donor to the Conservative party in the UK and a supporter of Brexit.

While Harborne owns a stake in Bitfinex, the lawsuit alleges that he does not have a managerial role at the crypto company. Bitfinex is the sister company to Tether (USDT).

“This defamation action arises from Defendant Dow Jones & Company, Inc.’s d/b/a The Wall Street Journal (the “Journal”) publication of an article in which it falsely accused Plaintiffs Christopher Harborne (“Mr. Harborne”) and AML of committing fraud, laundering money, and financing terrorists — even though the Journal and its reporters knew and possessed documentation that conclusively showed that those accusations are false,” the lawsuit reads.

The choice of location is quite puzzling as the Dow and Jones – the WSJ parent company – is based in New York and not Delaware.

Battle Moves to the Court?

In response to the lawsuit, a spokesperson for WSJ stated that a review was conducted after contact with Harborne’s attorneys. The spokesperson affirmed that WSJ would defend itself in court.

The article was corrected a few days before the lawsuit was filed, and an editor’s note was added to clarify that AML Global’s attempt to open an account at Signature Bank was not part of an effort to mislead banks.

The editor’s note appended to the article reads:

“A previous version of this article included a section regarding Christopher Harborne and AML Global, which applied for an account at Signature Bank. The section has been removed to avoid any potential implication that AML’s attempt to open an account there was part of an effort by Tether, Bitfinex, or related companies to mislead banks or that Harborne or AML withheld or falsified information during the application process.”

This dispute adds to the history of legal battles involving Bitfinex and Tether. In 2017, Bitfinex sued Wells Fargo over a bank transfer freeze. The suit alleged that the San Francisco-based bank had restricted four Taiwan-based banks from completing outbound wire transfers. The suit was dropped shortly after.