Allegations that US Commerce Secretary Howard Lutnick provided financing to his family’s foundation through a Tether-related loan sparked a new debate in the US Senate. Lutnick, who was previously the CEO of the financial company Cantor Fitzgerald, was among the names that handled Tether’s financial transactions in the USA. Both Cantor Fitzgerald and Tether stand out as institutions that play an active role in global finance and digital asset markets.
Open letter from senators
Elizabeth Warren, the senior Democrat member of the Senate Banking Committee, and Finance Committee Chairman Ron Wyden brought up allegations that Tether provided financing for billion-dollar transactions that enabled the transfer of Lutnick’s company shares to his children. Two senators stated that the loan in question was made within the framework of compliance with ethical rules after Lutnick joined the US Cabinet, but that such financial transactions made through Tether require auditing.
“If the news about this loan is true, it raises serious questions about the relationship between Lutnick and Tether and Tether’s influence on Lutnick’s public policies,” the senators said in a joint statement.
Tether’s amount information regarding the loan in question was not disclosed; The first news was brought to the agenda by Bloomberg. Senators demanded detailed explanations of the allegations from both Tether and Lutnick.
Tether’s strategy and political impacts in the USA
The US Congress, with the support of President Donald Trump’s administration, enacted a new law regulating Tether and similar stablecoin issuers last year. Tether CEO Paolo Ardoino and Lutnick were also in the front row at the ceremony where the law was signed. Lutnick also took an active role in the President’s Digital Assets Working Group, which conducts US policy studies on digital assets.
Senators emphasized that public officials should avoid conflicts of interest and conveyed the message: “It is unacceptable that your decisions are made for the financial benefit of your family or Tether, not the American people.”
Neither the Commerce Department nor Tether immediately responded to questions about the letters sent by senators.
A new era in family business management
Lutnick’s well-established financial company, Cantor Fitzgerald, currently operates under the leadership of brothers Brandon Lutnick and Kyle Lutnick. Brandon Lutnick serves as chairman and CEO, and Kyle Lutnick serves as vice chairman of the executive board.
Although Tether is headquartered in El Salvador, it is making special moves to strengthen its presence in the US market. The company’s US subsidiary operates under the leadership of Bo Hines, one of Trump’s former advisors. Additionally, Tether recently launched USAT, a new stablecoin pegged to the US dollar.
As a financial institution established in the USA, Cantor Fitzgerald has influential ties in the world of politics and finance. The company recently provided heavy financial support to a new political activity affiliated with the Republican Party. The total of these supports to the political committee called Fellowship PAC amounted to several million dollars. It appears that senior executives of Tether USA and Bo Hines and his family played an important role in the management and expenses of the committee.
