Democratic Senator Richard Blumenthal is probing investment bank Cantor Fitzgerald over its lucrative partnership with stablecoin issuer Tether. The inquiry focuses on Cantor's oversight of Tether's compliance with sanctions and banking laws, alongside a reported $250 million windfall received by U.S. Commerce Secretary Howard Lutnick. While a Senate staff report links Tether's USDT to sanctioned Iranian networks, Tether maintains it actively cooperates with global law enforcement.
Senate inquiry into Cantor Fitzgerald
- ▪U.S. Senator Richard Blumenthal sent a formal letter on October 8, 2026, to Cantor Fitzgerald Chairman Brandon Lutnick, demanding records on the investment bank's financial relationship and partnership with stablecoin issuer Tether
- ▪Senator Richard Blumenthal set a deadline of October 23, 2026, for Cantor Fitzgerald to respond to the subcommittee's inquiry
- ▪Senator Richard Blumenthal's inquiry requested that Cantor Fitzgerald explain how it monitors Tether's compliance with banking and sanctions laws, and details of steps taken to investigate allegations of illicit finance and sanctions evasion
Cantor Fitzgerald's financial stake in Tether
- ▪Cantor Fitzgerald acquired a 5% equity stake in Tether in 2024 and manages the custody of tens of billions of dollars of Tether's U.S. Treasury bill reserves
- ▪Senator Richard Blumenthal alleges that Cantor Fitzgerald's 5% stake in Tether appreciated in estimated value from $600 million to $10 billion since Donald Trump took office again
Howard Lutnick's divestiture and financial ties
- ▪Senator Richard Blumenthal's inquiry seeks the terms of Howard Lutnick's divestiture from Cantor Fitzgerald and details of any loans or financing Tether provided to the Lutnick family to facilitate the transfer of ownership
- ▪Senator Richard Blumenthal requested that Cantor Fitzgerald provide all communications involving U.S. Commerce Secretary Howard Lutnick regarding Tether, including communications after Howard Lutnick stepped down from Cantor Fitzgerald
- ▪U.S. Commerce Secretary Howard Lutnick reportedly received more than $250 million over the past two years from Cantor Fitzgerald's partnership with Tether, including a $192 million distribution from Cantor Fitzgerald
- ▪Howard Lutnick stepped down from his leadership role at Cantor Fitzgerald after being confirmed by the Senate as U.S. Commerce Secretary in February 2025, leaving his son Brandon Lutnick to assume leadership
Senate report on Tether's use in illicit finance
- ▪A Senate staff report released by Senator Blumenthal found that 87% of wallets flagged by Israel's National Bureau for Counter Terror Financing and 57% of wallets designated by the U.S. Treasury's Office of Foreign Assets Control relied heavily on USDT
- ▪A Senate staff report released by Senator Blumenthal alleges that two sanctioned Iranian oil smugglers moved over $603 million in USDT through networks connected to Hezbollah and Houthi factions between June 2021 and August 2026
- ▪A staff report released by Senator Richard Blumenthal on September 28, 2026, titled 'Tethered to Terrorism,' found that 84% of 846 sanctioned, Iran-linked crypto wallets transacted heavily in Tether's USDT
Tether's cooperation and asset freezes
- ▪Tether stated that it has frozen nearly $550 million in USDT linked to Iran-affiliated networks during 2026
- ▪Tether CEO Paolo Ardoino stated that Tether has cooperated with law enforcement for years, helping global authorities freeze more than $4.9 billion in assets, including over $2.4 billion in cooperation with U.S. authorities
Debatable claims
- ▪Howard Lutnick's financial windfall from Cantor Fitzgerald creates a conflict of interest
- ▪Cantor Fitzgerald's dual role as Tether shareholder and custodian compromises its compliance oversight
- ▪Tether's voluntary asset freezes are insufficient to prevent systemic sanctions evasion
- ▪Cantor Fitzgerald's partnership with Tether compromises United States national security
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