In a recent development, Eric Trump has stepped down from the board of FinTech company Alt5 Sigma, following a review by Nasdaq. The company has instead named him a board observer, marking a significant shift in his role.
Revised Deal and New Appointments
Alt5 Sigma has revised its deal with World Liberty Financial, a company linked to Eric Trump, to the tune of $1.5 billion. As part of this revised agreement, Trump will no longer serve on the board, but will instead act as an observer. Zak Folkman, co-founder and Chief Operating Officer of Wlfi, has been nominated as a director, subject to shareholder approval.
The adaptation was made two weeks after the company announced in August that Trump would become a Wlfi Director as part of its shareholder plan. Neither the company, Wlfi, nor Trump has commented on the changes, and Nasdaq has also declined to provide further information on the listing rule that triggered the change.
Controversy and Pressure
The SEC filing, which detailed Trump’s role, has also led to legal problems associated with Alt5 Sigma’s operations. A Rwandan court has found the company’s Canadian subsidiary guilty of money laundering and illegal enrichment, resulting in the confiscation of $3.5 million and the dissolution of the unit. Alt5 is appealing against the judgment, stating that it only became aware of the decision at the end of August.
Furthermore, the company has announced that it has received a summons in connection with an insolvency proceedings involving its former CFO, who allegedly failed to disclose limited stock units worth 330,000 shares. US authorities are seeking to recover these stocks or their value.
World Liberty Financial (WLFI), which started as a decentralized financial platform with Trump-branded tokens in 2024, has seen its token price decrease by 11% in the past week and 38% compared to its peak last week. Alt5 Sigma’s proportion of 7.3 billion tokens, each valued at $0.18, has estimated to be worth over $200 million, with its total stocks valued at $1.5 billion.
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