Senators probe Tether loan linked to Lutnick’s family

Senators Warren and Wyden are investigating a Tether loan to a trust for Commerce Secretary Lutnick’s children, citing ethics and conflict of interest concerns.

Senators Elizabeth Warren and Ron Wyden have launched investigations into a loan involving Commerce Secretary Howard Lutnick and stablecoin issuer Tether. The probe centers on a trust established for Lutnick’s children, which reportedly received a loan secured by all trust assets and backed by a convertible bond. This bond could potentially grant Cantor Fitzgerald a 5% equity stake in Tether. The loan was allegedly used to fund Lutnick’s divestment from Cantor Fitzgerald upon his appointment to the Cabinet. Lawmakers are concerned about possible conflicts of interest, especially after Cantor Fitzgerald made a $10 million donation to a pro-crypto super PAC led by a Tether executive. The senators have requested full disclosure of the loan terms and all communications between Lutnick and Tether to determine if preferential treatment or undue influence occurred. The Commerce Department maintains it is adhering to ethics rules, while Tether has not commented. The timing and structure of these transactions have raised concerns among officials and the crypto industry, with ethics experts questioning compliance with federal divestiture requirements.