Revelations About a Trump-Witkoff Business Raise Troubling Questions
Rules still apply when political power and private profit intersect: Publisher’s Roundup 62
When I was the Obama White House ethics czar during the Great Recession, I would not even allow the president to refinance his modest family home in Chicago. He was regulating the banks in a time of crisis, and it wouldn’t have looked right.
That’s not exactly the approach that President Trump, his cronies, and their families have adopted. I’ve written before about the Top 10 most outrageous corruption scandals of this administration. This week, my Democracy Defenders Fund colleagues and I added another item to the list. Working with former New Jersey Attorney General Matt Platkin, we filed a complaint with the Securities and Exchange Commission urging it investigate ALT5 Sigma (ALTS).
This company boasts Trump’s son Eric as a board member and Trump Special Envoy Steve Witkoff’s son Zach as its board chair. Its history in recent months is one of serious failures of compliance, breakdowns of governance, and profoundly concerning financial connections with another Trump and Witkoff-linked venture, World Liberty Financial (WLF).
The story starts in August, when ALTS told the world that it had raised $1.5 billion through various investment vehicles. ALTS then moved the money to WLF by buying $750 million of its $WLFI governance tokens, about 7% of total supply. As detailed in our letter, “ALTS appears to have steered as much as $500 million of private investor money directly into the pockets of the Trump family and their associates.” When this money hit their wallets, Zach Witkoff (co-founder and CEO of WLF) and Eric Trump (also a WLF co-founder) assumed leadership roles on the board of ALTS.
These facts give rise to questions that are of the utmost importance to the integrity of our financial markets and of our democracy, as our letter explains. The most profound: who were the investors who funded the ALTS $WLFI purchase–and did they do so in order to get in the good graces of the Trump administration?
The concerns about this transaction are only deepened by what went on in the period in and around this massive financial transfer to WLF. In August, ALTS disclosed that several months earlier a Rwandan court had ruled that ALT5 Sigma Canada Inc., a subsidiary of the company, and its former principal were criminally liable for illicit enrichment and money laundering, ordering imprisonment, fines, and dissolution of the subsidiary. Shortly thereafter, the CEO of ALTS was suspended without explanation, auditors changed multiple times within just a few weeks, and the company failed to meet the due date for filing its annual report. It’s little wonder that ALTS was at risk of being delisted from Nasdaq and its share price has plummeted. Despite the immense capital influx from these transactions, the share piece has declined by around 75%. The company is looking at hundreds of millions of dollars in losses for the 2025 fiscal year.
Given these troubling data points, our letter urges the SEC’s Enforcement Division to “carefully examine these issues because they indicate, both individually and collectively, that ALTS may have engaged in a number of securities violations, thereby harming investors and financial marketplace writ large.” This is not just a story about corporate governance. It is a test of whether the rules that protect investors and the integrity of American markets still apply when political power and private profit intersect.
Our SEC letter calling for an investigation of ALTS is just one of many similar filings we’ve made. This one is outrageous enough that even Trump’s SEC may investigate. But whatever they do, we’re laying down a marker for the press, the public and other enforcement authorities. Whether for state attorneys general and securities regulators, a future more independent Congress, or future federal regulators, there will be a trail of breadcrumbs to follow. Meanwhile, we must all demand answers.