Crypto Podcaster Is Suing Janet Yellen QouteCoin
New York City: In late 2017, when Bitcoin was soaring to $20,000, the Federal Reserve chair mused that the cryptocurrency might be useful if it didn’t rely on anonymous transactions. “We’ve had many financial crises where there have been runs on payment systems and deposit organizations,” Yellen said at a press conference that same month. “I’m not aware of particular incidents of terrorist financing or money laundering through Bitcoin,” she added.”
In late 2017, when Bitcoin was soaring to $20,000, the Federal Reserve chair mused that the cryptocurrency might be useful if it didn’t rely on anonymous transactions.
In late 2017, when Bitcoin was soaring to $20,000 and Yellen was not yet even the Fed chair but still head of the San Francisco Federal Reserve Bank. She mused that cryptocurrency could be useful if it didn’t rely on anonymous transactions:
“I don’t think we should be ruling out any technology just because of its anonymity,” she said at a conference in December 2017. “People ought to be able to transmit money without having their identities known.”
“We’ve had many financial crises where there have been runs on payment systems and deposit organizations,” Yellen said at a press conference that same month.
Yellen was not the first person to raise concerns about bitcoin. In February 2018, she said that cryptocurrencies were not a viable currency because they don’t have any intrinsic value and could be easily manipulated by hackers. She also said that anonymity in cryptocurrency transactions could lead to money laundering and terrorist financing. Yellen added that she wasn’t aware of any instances where users had been paid for their work using bitcoin or other digital currencies.
“I’m not saying this is going to happen,” she added at another conference later in March 2018, “but we’ve had many financial crises where there have been runs on payment systems and deposit organizations.”
“I’m not aware of particular incidents of terrorist financing or money laundering through Bitcoin,” she added.
In the interview, Yellen was asked about cryptocurrency and its potential to be used for money laundering. She responded by saying that she was not aware of any incidents in which bitcoin was used to carry out terrorist financing or other illegal activities.
“I’m not aware of particular incidents of terrorist financing or money laundering through Bitcoin,” she added.
The frenzy around Bitcoin and other cryptocurrencies may be subsiding, but as regulators contemplate how best to oversee them, Yellen and her colleagues are still being questioned about their views.
Cryptocurrencies are still being discussed in the news. Regulators are still discussing how to regulate them. And Janet Yellen, who served as chair of the Federal Reserve from 2014 through 2018, is still being questioned about her views on crypto.
On Thursday, a lawyer representing an American podcasting company filed a lawsuit against Yellen and other officials at the central bank over statements they made during an interview published by CoinDesk last year. The lawsuit claims that Yellen “did not have sufficient knowledge” when she said cryptocurrencies were “not a safe harbor” for fraudsters or criminals seeking to hide their money away from authorities and regulators—an assertion she made during an interview with CoinDesk reporter Pete Rizzo at the World Economic Forum held in Davos Switzerland last January 14th where Bitcoin was discussed extensively along with other cryptocurrencies such as Ethereum (ETH) & Ripple (XRP).
In the lawsuit, which was first reported by Politico, Maloney alleges that Yellen committed libel by saying the podcaster wasn’t aware of money laundering through bitcoin.
In the lawsuit, which was first reported by Politico, Maloney alleges that Yellen committed libel by saying the podcaster wasn’t aware of money laundering through bitcoin.
The suit says Maloney had become an expert on cryptocurrencies and blockchain technology and saw them as a potential hedge against inflation. He invested in businesses that use this technology but didn’t understand what they were doing with his money until he read an article written by Yellen in 2016. The article criticized cryptocurrency investors for not knowing how their investments could be used for illegal purposes like drug trafficking or gunship purchases.
He also suggests that she committed slander by questioning his knowledge of the cryptocurrency’s use for terrorism financing.
Libel and slander are the two most common types of defamation. Libel is the act of making false statements about someone, while slander refers to saying something about someone that’s harmful but not necessarily false.
Slander can be difficult to prove because there isn’t always proof that the statement was made with malice in mind (i.e., knowing it would harm another person). But given that Libel affects reputation, it’s often considered more serious than defamation (which only involves one party).
Slurs aren’t as easy to prove either—they’re just words used against someone as an insult or negative characterization—but they’re still considered defamatory by some courts because they cause emotional distress and therefore constitute harm if true (even if no one believes them).
Maloney’s lawsuit also names Thomas Feddo, who heads an office at the Federal Reserve that oversees consumer protection issues; Hester Peirce, one of five members of the Securities and Exchange Commission; and SEC Chairman Jay Clayton.
Maloney’s lawsuit also names Thomas Feddo, who heads an office at the Federal Reserve that oversees consumer protection issues; Hester Peirce, one of five members of the Securities and Exchange Commission; and SEC Chairman Jay Clayton.
Feddo said via email that he has no knowledge of any pending litigation against him or his agency. He did not respond to questions about whether he would be willing to testify if subpoenaed by Maloney’s attorney.
“I am directing inquiries regarding this matter to my counsel,” Feddo said in an email Wednesday afternoon. “I cannot comment further while there is a pending investigation.”
The lawsuit claims Feddo made a false statement to Congress by saying in written testimony that he hadn’t met with any crypto advocates to discuss regulatory issues beyond agency staff engaging with self-regulatory organizations like FinCEN.
The lawsuit claims Feddo made a false statement to Congress by saying in written testimony that he hadn’t met with any crypto advocates to discuss regulatory issues beyond agency staff engaging with self-regulatory organizations like FinCEN.
The plaintiff, who goes by the pseudonym “CryptoAuntie,” says she has been involved in the cryptocurrency space since 2014 and is currently an investor who owns Bitcoin, Ethereum and Litecoin. She also hosts a financial-advice show on Youtube called “Crypto Auntie’s Advice.”
She writes that it’s clear that Feddo was lying when he testified before Congress last year because he had met with the founder of Abra (a blockchain startup) and other officials from Ripple Labs Inc., one of the best known companies working on blockchain technology for use within banking systems or other applications where there will be high demand for cryptocurrencies like Bitcoin Cash (BCH).
Conclusion
Yellen is due to testify before Congress on Wednesday. Her testimony will give lawmakers another opportunity to ask her about crypto and its potential use for money laundering and terrorism financing.
