The U.S. Securities and Exchange Commission could not find records of an investigation into AI Financial Corporation, formerly Alt5 Sigma, over the previous year, according to a Freedom of Information Act response obtained by POGO Investigates. AI Financial is the public company that cut a massive 2025 deal with World Liberty Financial, the Trump family crypto venture, and then saw its stock collapse as investors got hammered.
POGO Investigates also surfaced a previously unreported shareholder lawsuit that accused the AI Financial-World Liberty arrangement of “illegality,” “unjust enrichment,” and “avarice.” Former senior SEC trial counsel Howard A. Fischer told POGO Investigates the situation looked like “the paradigmatic securities fraud case,” adding that misrepresentations or omissions to public-company investors are the “meat and potatoes” of SEC investigative work. AI Financial’s spokesperson told POGO Investigates the company is not being investigated.
In an SEC filing covered earlier this year, the company said there was “substantial doubt” about its ability to continue as a going concern, which is corporate language for a business openly acknowledging it may not have enough runway to survive another year.
The shareholder suit cited by POGO Investigates focused on what happened after World Liberty executives joined AI Financial’s board, back when the company was still called Alt5 Sigma. According to that reporting, the complaint alleged a “breakdown in the Company’s management” and described the World Liberty transaction as a large dilutive deal that enriched new insiders by unlawful means.
POGO Investigates also reported that Representative Ro Khanna said the SEC “need[s] to investigate,” partly because of the overlapping board roles between AI Financial and World Liberty. Reed Kathrein, of Hagens Berman Sobol Shapiro LLP, went a step further, telling POGO Investigates: “There may be political reasons this one is hands off.”
POGO Investigates reported that the company agreed to buy $717 million worth of World Liberty cryptocurrency and that World Liberty received 100 million shares in exchange for $750 million worth of tokens. POGO Investigates also noted that 75% of World Liberty token-sale proceeds flowed to a Trump family-owned entity after certain deductions, which is how the family’s take from the arrangement was estimated at about $500 million.
AI Financial has denied wrongdoing. In an SEC filing, the company said it disputes the allegations and would vigorously defend itself and the individual defendants. The shareholder lawsuit was later withdrawn with prejudice, which means it cannot be refiled. AI Financial declined to say whether that dismissal reflected a settlement, and a company spokesperson told POGO Investigates that AI Financial rejected attempts to present third-party allegations as facts.
That split between insiders cashing out and outside buyers absorbing the damage has become a recurring theme across Trump’s crypto empire. A Reuters report from earlier this year found that the more than $2 billion the Trump family had made via various crypto projects was roughly equal to the losses suffered by investors in those same projects.
The perceived conflicts of interest involving Trump and his crypto projects are also numerous. There is Justin Sun, one of the most visible names in the World Liberty orbit and a notorious figure in the crypto space more generally. Sun reportedly invested tens of millions of dollars into WLFI, and the SEC later resolved a civil fraud case against him for $10 million after previously pausing the matter. The sequence looked bad on its face, especially once Sun’s relationship with Trump-linked crypto projects became part of the broader public argument over whether political proximity was buying softer treatment. Now, Sun and World Liberty Financial are in a legal dispute regarding Sun’s frozen WLFI tokens.
Another example is Binance and its founder Changpeng Zhao. World Liberty Financial faciliated a deal involving Binance and a UAE fund. Zhao later received a pardon for his violations of the Bank Secrecy Act, and Binance still holds $2 billion worth of World Liberty Financial’s USD1 stablecoin, which generates tens of millions of dollars in annual revenue for the crypto project. Even in a political era with a very high tolerance for obvious conflicts, that is a hard sequence to dress up as normal.
The United Arab Emirates angle is even less subtle. A firm controlled by UAE National Security Adviser Sheikh Tahnoon bin Zayed Al Nahyan agreed to buy a 49% stake in World Liberty Financial for $500 million. The deal drew immediate scrutiny because it sat uncomfortably close to other high-stakes U.S.-UAE policy questions, including access to advanced AI chips.
Earlier this year, SEC enforcement chief Margaret Ryan resigned after clashing with agency leadership over enforcement strategy, including matters touching Trump and his family. At the same time, the agency sharply reduced its crypto-enforcement footprint. Reuters reported that Ryan’s exit came amid internal disputes over how aggressively to pursue misconduct, while lawmakers and outside critics warned that enforcement involving Trump-adjacent crypto projects looked especially vulnerable to political pressure.
This perceived corruption has also shadowed the politics around crypto legislation. Ethics concerns surrounding the CLARITY Act have dogged the bill for months, and critics argue that even revised language could still leave Trump’s core conflicts untouched. Duke lecturing fellow Lee Reiners has argued that market-structure legislation could directly benefit World Liberty Financial by helping its WLFI token avoid classification as a security.
Of course, Trump has insisted there is nothing improper about any of this. That defense has never been especially persuasive, partly because the core issue is not whether the paperwork is tidy. It is whether politically connected buyers and counterparties think doing business with Trump’s family can buy access, favorable treatment, or both.
That is also why the investor-loss story is not as simple as a bunch of dupes getting fleeced. Some buyers may have been speculating, sure. But others may have seen Trump-linked crypto as a political asset first and a financial asset second, meaning a bad trade could still serve its purpose if it bought proximity, goodwill, or visibility with the administration.
Even those who have supported Trump in the past, such as podcaster Joe Rogan, are now questioning what’s really going on with these crypto projects. “The thing about the crypto is, it’s shady as fuck but it’s legal. I don’t know if it should be,” Rogan said of Trump-linked crypto projects during a recent episode of The Joe Rogan Experience.
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