Two US senators have sent a new letter demanding that the Department of Justice (DOJ) and the Treasury Department investigate Donald Trump-backed World Liberty Financial (WLFI) over token sales allegedly linked to illicit actors.
Senators Question WLFI’s Token Sale
On Tuesday, CNBC News reported that Democratic Senators Elizabeth Warren and Jack Reed expressed concerns about potential national security risks related to one of the Trump family’s crypto ventures, World Liberty Financial.
In a letter seen by the news media outlet, the senators requested that Attorney General Pam Bondi and Treasury Secretary Scott Bessent investigate claims that the Trump-backed company had allegedly sold tokens to sanctioned entities or individuals with ties to illicit actors in Russia and North Korea.
Warren and Reed reportedly argued that WLFI “lacks adequate safeguards to prevent bad actors from moving funds or gaining influence over its governance,” raising concerns over a potential conflict of interest.
According to CNBC, the letter cited a recent report from the non-profit corporate watchdog Accountable.US, which affirmed that World Liberty Financial sold its WLFI token to “various highly suspicious entities,” including traders with ties to North Korea’s Lazarus Group, or using Russia’s A7A5 ruble-backed stablecoin, and Iran’s largest crypto exchange, Nobitex.
To the senators, the reported token sales to individuals with “open and obvious connections to enemies of the U.S.” indicate “an absence of robust sanctions and anti-money laundering controls.”
Additionally, they consider that the company “risks supercharging illicit finance activity” and raises national security risks by giving bad actors “a seat at the table” to influence the firm’s governance.
The letter added that the Trump family’s ties with the crypto venture “create a financial conflict of interest for Trump Administration officials that report to the President: prioritizing token sales will directly enrich the Trump family — while compliance activities may interfere with this wealth creation.”
Conflict Of Interest Claims Mount
A spokesperson for World Liberty Financial rejected any misconduct, stating, “There is no conflict of interest between World Liberty Financial, a private crypto company with zero political power, and the U.S. government.”
Moreover, the representative told CNBC that “World Liberty Financial conducted rigorous AML/KYC checks on every pre-sale purchaser of the $WLFI governance token — the highest standard in the industry — and turned down millions of dollars from potential purchasers who failed the tests.”
It’s worth noting that the Democratic lawmakers have pressed multiple government officials, including the US Special Envoy for peace missions, the Securities and Exchange Commission (SEC)’s former acting chairman, and the head of the Office of the Comptroller of the Currency (OCC), about Trump’s crypto ventures and potential conflicts of interest.
Most recently, they have questioned the recently granted pardon to Binance’s co-founder and former CEO, Changpeng “CZ” Zhao. As reported by Bitcoinist, the US president denied allegations of potential corruption, alleging that he is not actively involved in the Trump family’s crypto businesses.
Nonetheless, the Democratic senators argued that the timing of their request is essential ahead of Congress’s efforts to develop new crypto regulation that could protect governance tokens like WLFI from current US oversight.
“As Congress considers legislation on the market structure for digital assets, we must ensure that crypto interests do not profit at the expense of U.S. national security and that illicit actors are not handed the keys to financial platforms that they can later exploit,” the letter added.
Ultimately, the senators requested that the DOJ and the Treasury provide the pertinent information against World Liberty Financial by December 1.
WLFI trades at $0.14 in the one-week chart. Source: WLFIUSDT on TradingView
Featured Image from Unsplash.com, Chart from TradingView.com
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