Trump Family-Linked Crypto Company Faces More Scrutiny Over Auditor Controversy

Recent reports claim that the internal turmoil of a crypto treasury company backed by the Trump family has deepened as the firm risks being delisted from Nasdaq and has appointed an audit company facing regulatory scrutiny.

Crypto Treasury Company’s Turmoil Intensifies

On Monday, Nasdaq-listed crypto treasury company Alt5 Sigma is facing renewed scrutiny after appointing a new audit company with an expired and inactive license earlier this month, the Financial Times initially reported.

The Las Vegas-based company rebranded from a biotech company to a Digital Asset Treasury Company (DAT) earlier this year, seeking to become the first publicly traded firm to accumulate WLFI, the token of US President Donald Trump’s crypto ventures, World Liberty Financial.

As the report noted, the company’s financial position has turned murky over the past few months due to its failure to file quarterly results on schedule. Now, its recent switch of auditors has deepened its current position as the newly appointed firm, Victor Mokuolu CPA PLLC, was allegedly fined by accounting regulators and failed an inspection under the standard peer review process.

According to the Financial Times, filings in the state of Texas show that the company’s licence expired in August. Meanwhile, the board’s records show that its license has not been renewed by December 26. Therefore, state regulations prohibit the firm from doing any audit work until the licence is renewed.

The audit company has reportedly been working for over two years to address its deficiencies, which previously resulted in a failing grade under the accounting profession’s peer review process in 2023.

This year’s failure to renew its license follows the Texas State Board of Public Accountancy and another US regulator’s actions against the firm for “repeatedly failing to file regulatory paperwork on time.”

In a statement to the news media outlet, Alt5 Sigma affirmed that the auditor is “undergoing a peer review per Texas State Board of Accountancy regulations and will be completed by the end of January 2026, at which point the auditor expects the firm’s licence to be active.”

The Trump-backed crypto treasury firm emphasized that “No reviews or audits of Alt5’s financial statements will be issued by our auditor until the firm’s licence is active.”

In an update, the Financial Times added that Alt5 Sigma fired the audit firm on Christmas Day following its inquiries about the issue. A regulatory filing made on Monday reportedly shows that the company has hired LJ Soldinger Associates as its new accounting firm.

Alt5 Sigma Risks Nasdaq Delisting

The controversial December 8 appointment comes amid a period of turmoil for the company, the report noted, as it already risks being delisted from Nasdaq, where it trades under the ticker “ALTS.”

The company failed to submit its quarterly results for the period ending in late September, blaming the delay on the “timeliness and responsiveness” of its previous auditor, who seemingly quit last month. This has opened the door to a potential delisting from the stock exchange.

In August, World Liberty Financial unveiled its partnership with Alt5 Sigma and became an investor in the technology firm, which sought to raise $1.5 billion for its crypto treasury strategy based on WLFI.

As a result, multiple World Liberty Financial co-founders joined Alt5 Sigma’s board. Notably, Zach Witkoff, son of President Trump’s Special Envoy Steve Witkoff, was appointed as chairman of the crypto treasury firm.

Similarly, Eric Trump joined the company’s board as a director, while Zak Folkman became a board observer. Nonetheless, Trump stepped down from his position in September, just weeks after being appointed, as revealed in a Securities and Exchange Commission (SEC) filing

Jonathan Hugh, Alt5’s Chief Financial Officer (CFO), left the company after just three months, while chief executive Peter Tassiopoulos resigned in October. Meanwhile, board member David Danziger parted ways with the firm in November.

This also puts the company “in violation of a requirement to have an audit committee of a certain size and with accounting experience,” the report concluded.