Eric Trump has been sidelined from joining the board of fintech firm Alt5 Sigma, with the company instead naming him a board observer after a review with Nasdaq.
Summary
- Alt5 Sigma revised its $1.5B deal with World Liberty Financial, removing Eric Trump from its board after Nasdaq consultation.
- Trump will serve only as an observer, while WLFI co-founder Zak Folkman has been nominated as a director, pending approval.
- The SEC filing also revealed legal troubles tied to Alt5 Sigma’s Canadian subsidiary and a bankruptcy dispute involving its former CFO.
Eric Trump will not be joining the board of Alt5 Sigma as previously announced, with the company quietly revising its deal with Trump-linked World Liberty Financial following discussions with Nasdaq, Forbes reported Sept. 9.
Alt5 Sigma deal reshaped under Nasdaq rules
Alt5 Sigma revealed in an Securities and Exchange Commission filing that, instead of joining the board, Trump will serve only as a board observer. The adjustment came two weeks after the company announced in August that Trump would become a director as part of its $1.5 billion share sale plan tied to WLFI.
In the revised structure, WLFI co-founder and chief operating officer Zak Folkman has been nominated as a director, subject to stockholder approval. Alt5 did not disclose which Nasdaq listing rule prompted the change, and neither the firm, WLFI, nor Trump responded to Forbes’ requests for comment. Nasdaq also declined to elaborate.
The Trump-affiliated LLC behind WLFI controls about 38% of the venture, along with 22.5 billion WLFI tokens, giving it rights to roughly 75% of token sale proceeds.
Controversies add pressure
The SEC filing that detailed Trump’s role change also revealed legal troubles tied to Alt5 Sigma’s operations. A Rwandan court recently found its Canadian subsidiary and a former principal guilty of money laundering and illicit enrichment, seizing $3.5 million and dissolving the unit. Alt5 is appealing the ruling, saying it only learned of the decision in late August.
Separately, the company disclosed it had received a summons in connection with a bankruptcy case involving its former chief finance officer, who allegedly failed to disclose restricted stock units worth 330,000 shares. U.S. trustees are seeking to recover those shares or their value.
WLFI launched in 2024 as a Trump-branded decentralized finance platform, but the token began trading in early September. As of press time, World Liberty Financial (WLFI) traded at $0.2039, down 11% in the past week and about 38% from its peak.
Alt5 Sigma’s stake of 7.3 billion tokens, acquired at $0.18 each, has already appreciated by more than $200 million, valuing its total holdings near $1.5 billion.
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