Alt5 Sigma — the US-listed crypto firm that made headlines this summer by striking a token purchase deal with a Trump-linked project — is now under fresh scrutiny after a cascade of audit, filing and board disruptions, the Financial Times reports.
Why it matters
- In August Alt5 Sigma agreed to buy and hold tokens from World Liberty Financial (WLFI), a crypto venture backed by the Trump family. As part of the arrangement, Eric Trump became a board observer and World Liberty Financial invested in Alt5 Sigma. The company now holds about 7.3 billion WLFI tokens — roughly $1.1 billion in value as of Dec. 8.
- The combination of a politically connected token position and a string of governance and regulatory problems has put the company squarely in the regulators’ and investors’ crosshairs.
Key governance and audit problems
- Missing financials: Alt5 Sigma has not filed quarterly results for the period ending in late September, exposing it to potential delisting from Nasdaq. The company blamed delays in part on the timeliness and responsiveness of its previous auditor, which resigned in November.
- Auditor questions: In December Alt5 Sigma named Victor Mokuolu CPA PLLC as its new auditor — but filings in Texas show the firm’s licence to practise expired in August and had not been renewed as of Dec. 26. Under state rules the firm cannot perform audit work until its licence is reactivated.
- The company told the FT that Victor Mokuolu CPA PLLC is undergoing a mandatory peer review under Texas State Board of Accountancy rules, and that process is expected to finish by the end of January 2026. Alt5 Sigma said no audit or review of its financial statements will be issued until the firm’s licence is active. (Victor Mokuolu renewed his personal CPA licence on Aug. 31, but the firm licence remained inactive at year-end.)
- Past enforcement: The audit firm was fined $30,000 by the PCAOB in 2023 for failing to notify the regulator about audits of six public companies, and the Texas board added a $15,000 penalty for the same violations. The firm also received a failing grade in a 2023 peer review and has been working to remedy deficiencies since then. Despite these issues, it disclosed 30 small-cap audit clients in a recent filing.
Board and executive turnover
- Senior exits and gaps have compounded the problem: CFO Jonathan Hugh (hired around the time of the WLFI deal) left after three months, CEO Peter Tassiopoulos exited in October, and board member David Danziger resigned last month.
- Danziger’s departure reportedly leaves the company out of compliance with Nasdaq requirements to maintain an audit committee of a specified size and with accounting expertise.
Corporate background and other disclosures
- Alt5 Sigma was incorporated in July 2024 by biotech company JanOne Inc., which merged with and took the Alt5 Sigma name the same month. JanOne had previously rebranded in 2019 from Appliance Recycling Centers of America.
- The firm says it provides infrastructure for financial institutions to integrate with digital assets. Since August, its chair has been Zack Witkoff, co‑founder of World Liberty Financial and son of Steve Witkoff, who serves as President Trump’s special envoy for peace negotiations.
- Separately, Alt5 Sigma disclosed that a Canadian subsidiary and a former principal were found criminally liable by a Rwandan court in May on charges including illicit enrichment and money laundering. That ruling is under appeal and both parties deny wrongdoing.
What to watch
Alt5 Sigma’s disclosure gaps, auditor licensing issues and board instability raise immediate questions about internal controls and oversight — particularly because the firm is holding a politically sensitive token position. Investors and regulators will be watching for the resolution of the auditor’s licence and peer review, the filing of overdue financial results, and actions to restore board and audit-committee compliance.
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