Circle Faces Criminal Charges After Refusing to Unfreeze $381K in Stolen USDC

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According to the International Consortium of Investigative Journalists (ICIJ), Circle has been charged criminally by Wisconsin prosecutors after refusing to comply with a court order to transfer frozen stablecoins to law enforcement. A Wisconsin victim lost approximately 381,000 USDC through fraud; the court issued a mandate last December requiring Circle to move the frozen assets, but the company declined, citing technical inability to burn and reissue tokens. New York prosecutors have separately written to the U.S. Senate, alleging Circle repeatedly rejected requests to freeze assets and questioned whether the company benefits from holding at least 119 million frozen USDC, which continues to generate interest. Circle denied the allegations, claiming Wisconsin courts lack jurisdiction, while noting preliminary agreement with federal prosecutors on victim compensation. Crypto tracking experts contend the company could execute token burns and reissuance through code updates.
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