Alt5 Sigma Faces Scrutiny Over Conflicting Timelines in SEC Filings
Alt5 Sigma is facing new scrutiny after conflicting timelines in its SEC filings raised questions about how and when the company announced the resignation of its independent accountant.
A recent filing on Black Friday revealed that Alt5 Sigma informed the SEC that it learned on November 21 that its independent accountant, William Hudgens, had resigned “effective immediately.” However, according to Forbes, Hudgens stated that he had informed the company before June 30 that he would be withdrawing from auditing public companies and would not complete any work beyond the second quarter filed on August 12.
Discrepancies in Auditor Resignation and Quarterly Reports
Alt5 Sigma still hasn’t filed its third-quarter report, and in an earlier SEC filing on November 12, the company blamed the delay in part on the “timeliness and responsiveness” of its accountant. When Forbes later asked who was in charge of the company’s financial audit at this time, a spokesperson declined to comment. Public companies must notify the SEC within four business days when an auditor resigns, and securities law experts who spoke to Forbes said the discrepancy in data coupled with the late quarterly filing could raise regulatory questions.
Previous Leadership Changes and Disclosure Gaps
The uncertainty surrounding the accountant’s departure stems from another filing with unclear dates. Alt5 Sigma reported that its board of directors suspended its chief executive, Peter Tassiopoulos, on October 16. However, an internal email to staff dated September 4, six weeks earlier, said he was already on temporary leave while a special committee reviewed unspecified matters. The same message said CFO Vay Tham had also been placed on leave.
Legal experts noted that records containing material inaccuracies can violate anti-fraud regulations, although it is difficult to prove intent. The latest management changes were announced just before Thanksgiving, with Alt5 Sigma telling the SEC that it terminated acting CEO and CFO Jonathan Hugh without cause, terminated the consulting agreement with Chief Operations Officer Ron Pitters, accepted the resignation of Director David Danziger, and dissolved the special committee after receiving its findings.
Donald Trump’s Crypto Link Adds Weight
Alt5 Sigma’s connection to the Trump-aligned company World Liberty Financial has played a large role in its recent activities and public visibility. In August, the company agreed to raise $1.5 billion to build a hoard of WLFI tokens. Half of the deal was paid in WLFI worth $0.20 per token, while the other half was raised through a stock offering. The agreement gave World Liberty Financial influence in Alt5 Sigma’s boardroom, with Zach Witkoff becoming chairman, while Eric Trump and Zak Folkman were assigned the roles of director and observer, with adjustments later made after consultation with Nasdaq.
According to CoinGecko, Alt5 Sigma now holds around $1.1 billion in WLFI tokens on paper, more than five times its own market cap. The company’s shares have fallen about 80% since the deal was announced. Alt5 Sigma declined to comment on the discrepancies in its filings, its accountant’s schedule, or its internal reviews. Regulators also had no comment, leaving open the question of whether the company’s recent disclosures will trigger further investigations.
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