The US Attorney's Office for the Southern District of New York filed a civil forfeiture complaint on September 14 against $61.2 million in frozen USDT allegedly tied to black market Iranian oil sales. According to the latest court records, the complaint targets ten TRON addresses that collectively held 61,192,367.59 USDT when prosecutors submitted their complaint. Tether has frozen all ten targeted wallets, with balances ranging from 1 million USDT to more than 12.75 million USDT per address. The September 14 seizure warrant authorized by US Magistrate Judge Ona T. Wang permits the FBI to transfer the assets into government custody, with prosecutors expecting Tether to burn the tokens and issue replacement USDT of equal value to be stored in an FBI-controlled hardware wallet.
The complaint names the same two entities at the center of a Senate probe earlier this year, creating a stark contrast with Binance's previous defense. In a March 6 response to a U.S. Senate inquiry, Binance Co-CEO Richard Teng called allegations involving Blessed Trust and Hexa Whale "demonstrably false, unsupported by credible evidence, and defamatory." The exchange maintained that no Binance account had transacted directly with an Iran-based entity and pointed to its know-your-customer, sanctions-screening and transaction-monitoring systems. However, Monday's complaint alleges that at least seven linked addresses labeled "Entity A" received and distributed more than $1.5 billion from Iranian oil sales, with funds sent to Iranian exchange Nobitex, IRGC-related cryptocurrency addresses, and money transmitters identified as IRGC fronts. According to prosecutors, the money was ultimately intended to benefit the Iranian government and entities connected to Iran's Islamic Revolutionary Guard Corps (IRGC), which has been designated as a foreign terrorist organization by the United States. Deputy US Attorney Sean Buckley announced the action, emphasizing that Binance is not named as a defendant in the civil forfeiture complaint.
The Justice Department has identified a massive $1.5 billion underground pipeline, internally dubbed "Entity A," that moved black-market Iranian oil money through a complex web of unhosted cryptocurrency wallets. According to the DOJ statement, this network transferred massive sums of illicit cash directly to an Iranian crypto exchange, as well as digital wallets and businesses tied to the IRGC. Two Chinese companies, Blessed Trust and Hexa Whale, allegedly acted as the primary facilitators coordinating the vast majority of these multi-million dollar transfers. Both firms used trading accounts on Binance to launder the black-market oil proceeds before funneling the funds back to the Iranian government and its proxies. Blessed Trust, which markets itself as a digital asset custodial services firm for other financial providers, offered a fiat-to-crypto conversion ramp for these Iran-linked transactions, occasionally utilizing U.S.-based cryptocurrency issuers. Meanwhile, Hexa Whale allegedly provided similar laundering services while masquerading as a legitimate commodities brokerage, with both entities counting Chinese oil and petroleum product companies among their clientele.
Recent U.S. Department of Justice documents reveal that Hamas' military wing, Al-Qassam Brigades, advised potential donors to avoid Binance and use alternative cryptocurrency platforms instead. According to the DoJ filing, the group recommended using Bybit, OKX, Kast and Redotpay as better options for funding transfers, specifically advising donors to "transfer through the application: trust wallet, RedotPay, OKX, Kast, BYBIT." The military wing stated that Binance can be used to purchase currencies only, then use another application to complete the transfer process. The guidance, contained in a full Al-Qassam Brigades letter appearing in the DoJ asset-seizure warrant, advised using Tether's USDT stablecoin and the TRC-20 network for transfers. This recommendation provides a rare glimpse into how sanctioned militant groups evaluate crypto platforms for their donors, with the military group noting that using Binance "can be used to purchase currencies only, then use another application to complete the transfer process."
This is not the first time Binance-linked accounts have surfaced in Iran-related sanctions reporting. According to Reuters reporting, Shelbit, an Iran-linked exchange that was fined in Dubai, sent $676 million onto Binance. The Justice Department's complaint does not name Binance as a defendant, targeting the cryptocurrency itself along with Blessed Trust and Hexa Whale's alleged role. Binance itself faces no charges in the filing, though the exchange has disputed earlier Iran-linked allegations and completed separate compliance reviews that led to the offboarding of both companies. As reported by AMBCrypto, this isn't the first time such instances have occurred - as far back as April 2026, when the U.S.-Iran conflict was at its peak, Iran reportedly accepted Bitcoin payments for a proposed $1-per-barrel toll from ships passing through the Strait of Hormuz. The Wall Street Journal reported that cryptocurrency wallets connected to Hamas received about $41 million between 2020 and 2023, with the Treasury investigating $165 million in cryptocurrency-linked transactions that may have helped finance Hamas prior to the October 2023 attacks.
The filing lands two weeks before Binance's planned UK license bid opens for applications on September 30. As reported by The Block, the exchange is seeking Financial Conduct Authority (FCA) authorization under Britain's new crypto framework. FBI Assistant Director in Charge James C. Barnacle, Jr. stated that "By cutting off funds raised by the black-market sale of crude oil, the Iranian military and terrorists are weakened. The FBI will not relent in its resolve to drain the funds from dangerous foreign actors." The Justice Department emphasizes that this is a civil case against the assets themselves, with the underlying allegations remaining unproven until a federal court enters judgment in favor of the United States. According to AMBCrypto, the complaint definitely had some impact on the price of BNB, as it was changing hands at $717.02 at press time after a drop of 1% in the past 24 hours. Binance Co-CEO Richard Teng responded on Tuesday, stating that the DOJ case names no wrongdoing by Binance and that the exchange has zero tolerance for sanctions violations, having cooperated with law enforcement since the matter was first raised months ago. Binance's chief compliance officer Noah Perlman noted that "When terrorist groups tell people to avoid Binance, it shows our controls are working," emphasizing the exchange's investment in sanctions screening, transaction monitoring and investigations.
