ALT5 Sigma, a Canadian fintech firm, is facing a significant crisis following its merger with World Liberty Financial in August 2025. The company is now under investigation for serious allegations, including undisclosed legal issues and a troubling money laundering conviction in Rwanda, which has raised concerns about transparency and governance within the organization. The report expresses concern that these issues could severely impact the firm's reputation and operations.
Rwandan Court Conviction and Internal Chaos
Earlier this year, a Rwandan court found ALT5 Sigma criminally liable for money laundering, a conviction that was reportedly not disclosed to World Liberty's board prior to the merger. This lack of transparency has sparked internal chaos, leading to the suspension of CEO John Isaac in September 2025, a decision that was kept under wraps until October. Employees have been warned about potential litigation and regulatory scrutiny, with the undisclosed conviction appearing to be a key factor in the escalating investigations.
Stock Price Plummets and SEC Investigation
Since the merger, ALT5 Sigma's stock price has plummeted by approximately 75%, reflecting investor concerns over the unfolding crisis. The situation intensified in late November when Forbes reported that the SEC is investigating the company regarding filings related to the suspended CEO. Concurrently, US Senators Elizabeth Warren and Jack Reed have called for a federal investigation into World Liberty Financial, citing allegations that the firm sold tokens to entities in sanctioned jurisdictions, including:
- Russia
- North Korea
- Iran
Allegations and Compliance Concerns
The senators' letter raised alarms about DT Marks DeFi LLC, an entity affiliated with the Trump family, which reportedly receives 75% of the proceeds from these token sales. While a spokesperson for World Liberty Financial has denied all allegations, asserting that the firm adheres to strict AML and KYC protocols, Warren and Reed contend that evidence suggests significant compliance failures. What began as a promising merger has now devolved into a complex web of regulatory challenges and reputational damage for both ALT5 Sigma and World Liberty Financial.
In contrast to the turmoil faced by ALT5 Sigma, Endava PLC is experiencing a promising earnings recovery. For more details, see the full report here.
