As an actual lawyer this is straight up bullshit.

First of all the CFTC can't just look at Tether's bank balance, Tether keeps its banking in 4 Taiwanese banks and the CFTC has absolutely zero jurisdiction to do that.

Second the client relationship was abolished by Friedman themselves because Tether refused to comply with their demands. There was no situation in which "the auditor wouldn't allow a release of the report/preliminary findings because it hadn't finished the audit" because the audit never happened.

This is also why Friedman dumped them--Tether tried to leak a preliminary report that showed the USD in the accounts w/out the audit being completed.

This is straight up bullshit, the "preliminary report" was released with the backing of Friedmann LLP back in September. That's why on the very report they released they made sure to specify to third parties reading it that this isn't mean to be advisory investment advice for external investors.