Alt5 Sigma — the US-listed crypto company that drew attention this summer for agreeing to hold tokens tied to a Trump-backed project — is now under intensified regulatory and governance scrutiny after a string of audit, filing and board disruptions, the Financial Times reports.
What happened
- In August Alt5 Sigma agreed to buy and hold tokens issued by World Liberty Financial (WLFI), a crypto project backed by the Trump family. The transaction also brought Eric Trump on as a board observer and made World Liberty Financial an investor in Alt5 Sigma.
- Since then the company has missed key reporting deadlines, experienced rapid executive turnover and shuffled auditors, prompting concern from investors and regulators.
Audit and accounting red flags
- In December Alt5 Sigma named Victor Mokuolu CPA PLLC as its new auditor. But Texas filings show the firm’s licence to practise expired in August and had not been reactivated as of December 26 — a status that, under state rules, bars it from performing audit work until the licence is reinstated.
- Alt5 Sigma says the auditor is undergoing a mandatory peer review under Texas State Board of Accountancy rules and expects the process to finish by the end of January 2026. The company added it will not issue an audit or reviewed financial statements until the firm’s licence is active.
- The audit firm has a checkered regulatory history: the PCAOB fined Victor Mokuolu CPA PLLC $30,000 in 2023 for failing to report audits of six public companies, and the Texas board imposed an additional $15,000 penalty for the same violations. The firm also received a failing peer-review grade in 2023 and has been addressing related deficiencies for more than two years.
Filing delays, leadership churn and governance gaps
- Alt5 Sigma has not filed its quarterly results for the period ending in late September, a lapse that risks Nasdaq delisting.
- The company blamed delays partly on the responsiveness of its prior auditor, which resigned in November.
- Leadership turnover has been significant: CFO Jonathan Hugh left after about three months, CEO Peter Tassiopoulos departed in October, and board member David Danziger resigned last month. Danziger’s exit reportedly left the company out of compliance with rules requiring an audit committee of a certain size with accounting expertise.
Corporate background and political links
- Alt5 Sigma was incorporated in July 2024 by JanOne Inc., which merged into the new entity and adopted the Alt5 Sigma name. JanOne itself had rebranded in 2019 from Appliance Recycling Centers of America.
- The firm says it provides infrastructure to help financial institutions integrate with digital assets.
- As of December 8, Alt5 Sigma disclosed holdings of roughly 7.3 billion $WLFI tokens, valued at about $1.1 billion.
- Since August the company’s chair has been Zack Witkoff, co-founder of World Liberty Financial and the son of Steve Witkoff, who has served as President Trump’s special envoy for peace negotiations.
Legal issues abroad
- Alt5 Sigma has also disclosed that its Canadian subsidiary and a former principal were found criminally liable by a Rwandan court in May for offences including illicit enrichment and money laundering. That ruling is under appeal, and both the company and the individuals deny wrongdoing.
Why it matters
Alt5 Sigma sits at the intersection of political attention, large token holdings and weak controls: missed filings and an auditor without an active firm licence raise immediate disclosure and compliance questions, while board and executive departures have left governance gaps. For investors and regulators, the priorities to watch are reactivation of the auditor’s licence and completion of the peer review, the filing of overdue financials (and Nasdaq’s response), and the outcome of the Rwandan appeal.
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