Alt5 Sigma Under SEC Scrutiny Over Trump Crypto Connection

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The post Alt5 Sigma Under SEC Scrutiny Over Trump Crypto Connection appeared first on Coinpedia Fintech News

Alt5 Sigma, once connected to Trump’s crypto venture, World Liberty Financial, is now under intense regulatory pressure. The U.S. SEC is investigating the company for possible violations related to financial reporting and leadership disclosures.

Auditor Resignation Raises Red Flags

A key issue involves Alt5 Sigma’s former auditor, William Hudgens. The company told the SEC that Hudgens resigned on November 21. However, Hudgens says he informed Alt5 months earlier before June 30, that he planned to stop auditing public companies after the second-quarter filing.

SEC rules require companies to report an auditor’s resignation within four business days. Alt5 Sigma has not yet filed its Q3 report and previously blamed delays on its accountant. When asked about who the accountant was at the time, the company refused to comment. Experts say this discrepancy could be a serious breach of federal reporting rules.

CEO Suspension Also Under Scrutiny

Alt5 Sigma may also have mishandled reporting CEO Peter Tassiopoulos’ suspension. Official filings stated he was placed on leave on October 16, but an internal memo dated September 4 shows he had been suspended much earlier. Federal rules require companies to report executive departures, including suspensions, within four business days. Missing this deadline adds another potential violation and raises concerns about governance.

Impact and Investor Concerns

Alt5 Sigma’s issues come at a sensitive time. The company had agreed to help raise $1.5 billion to build a treasury of WLFI tokens for World Liberty Financial. Eric Trump was initially expected to join the board but was later removed. The company holds roughly 1.1 billion WLFI tokens, yet its stock price has dropped since the partnership announcement, raising questions about stability.

What’s Next

With the SEC monitoring closely, Alt5 Sigma could face penalties if violations are confirmed. The investigation also puts a spotlight on the company’s connections to high-profile crypto ventures and governance practices. Investors and stakeholders are likely to watch closely for the company’s next filings and official responses.