Trump’s choice for commerce secretary, Lutnick, is under Warren’s scrutiny due to his Tether connections.
Senator Warren pressed Howard Lutnick, nominated by Trump for commerce secretary, on his associations with Tether and stablecoins.
Cantor Fitzgerald CEO Howard Lutnick, nominated for Commerce Secretary by Trump, faces Warren’s scrutiny for his investment firm’s links to Tether.
In a Jan. 27 letter, Warren expressed “serious concern” about Lutnick’s “deep involvement with and support for Tether, a known facilitator of criminal activity that has been described as ‘outlaws’ favorite cryptocurrency.’”
“While you have agreed to divest your interest in Cantor Fitzgerald, which holds a 5% stake in Tether and serves as Tether’s asset manager, this divestment does not end the questions about your deep personal ties to the company or its affiliates,” wrote Warren, the top Democrat on the Senate Banking Committee.
She remarked that she continues to doubt his “ability to put the interests of the American people” above his personal financial stakes if he secures the role of Commerce Secretary.
Warren warned that if Lutnick is approved in his Jan. 29 hearing, he will directly influence Trump and regulators responsible for Tether oversight.
She claims this will place him “in a position to influence policies that may directly or indirectly impact Tether and the entire cryptocurrency industry.”
She demanded that Lutnick clarify his financial ties to Tether and reveal any discussions he has had with the Trump administration, as part of a 13-question inquiry.
Warren sought clarification on whether Cantor Fitzgerald had conducted a compliance review to ensure Tether follows Know Your Customer rules, international sanctions, and financial crime laws.
The Massachusetts senator set a Feb. 10 deadline for her questions to be answered, but she is not part of the committee handling Lutnick’s confirmation hearing.
Warren argued that bad actors use Tether’s stablecoin to facilitate criminal activities such as sanctions evasion, money laundering, and financing North Korea’s nuclear ambitions.
Neither Tether nor Cantor Fitzgerald responded immediately to the request for comment.
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Through its cooperation, Tether has helped authorities combat illegal activities.
By working with Tron and TRM Labs, Tether helped Spanish law enforcement freeze $26.4 million in crypto on January 27, connected to a money laundering network across Europe.
Last September, Tether disclosed its assistance to the FBI in retrieving $6 million from scammers who targeted U.S. citizens by freezing their wallets.
A crypto skeptic, Warren has consistently called for increased regulation in the sector, including recently urging Trump’s Treasury selection to adopt tougher crypto regulations.
Both in 2022 and 2023, Warren introduced the Digital Asset Anti-Money Laundering Act, pushing for the crypto industry to comply with established AML and CTF standards.
US-based crypto group Chamber of Digital Commerce, along with 80 former military and national security officials, slammed the bill, fearing it could hamper law enforcement and increase national security concerns by forcing the digital asset industry abroad.
