A normal bank would maintain fractional reserves, and is insured and backed by the U.S. government. But Tether has a problem, the backbone of Tether's business is to exchange one USD for one USD₮. Now Tether must prove it has that money, in case people people would like to withdraw. It is possible to "burn" Tether to maintain the price, unfortunately that is not the case. Since Bitfinex lost it's ability to bank, no one has been able to withdraw Tether, therefor maintaining the price within 10 American Pennies.

Of course Tether might have the money, and is stuck with incompetent auditors, OR Tether has essentially created fake money propping the price of Bitcoin up.