US investment bank Cantor Fitzgerald has come under renewed scrutiny in the US Senate over its business ties to Tether, as Senator Richard Blumenthal demanded details about how the firm oversees Tether’s compliance with banking and sanctions rules.
In a letter dated Thursday, Blumenthal—ranking Democrat on the Senate Permanent Subcommittee on Investigations—pressed Cantor chairman Brandon Lutnick to provide documents and explanations regarding Cantor’s partnership with Tether, including communications involving Commerce Secretary Howard Lutnick related to the stablecoin arrangement.
Key takeaways
- Senator Richard Blumenthal is asking Cantor for records on how it monitors Tether’s compliance with banking and sanctions laws.
- The letter seeks documentation of all communications involving Howard Lutnick about Tether, including activity after he left Cantor.
- Blumenthal points to Cantor’s reported Tether stake and related custody of reserve assets, alleging substantial value growth and family payouts.
- The renewed inquiry follows Democratic investigators’ prior allegations that USDT has been used in Iran-linked illicit finance channels.
- Cantor and Tether have not provided an immediate response to requests for comment, according to coverage by Cointelegraph.
Blumenthal escalates requests tied to Cantor’s Tether partnership
Blumenthal’s letter, addressed to Cantor chairman Brandon Lutnick, argues that Cantor’s “lucrative business arrangements” with Tether may raise national security concerns. He demanded clarity on what Cantor does to ensure Tether adheres to banking and sanctions requirements, according to the letter.
The senator also asked for transparency around the scope of involvement by Commerce Secretary Howard Lutnick. In particular, Blumenthal requested records of communications between Howard Lutnick and Tether, extending beyond the period when he led Cantor and including after he stepped away from the firm.
In the letter, Blumenthal said the arrangements appear to come “at the expense of America’s national security,” framing the request as part of an effort to understand whether corporate structures around a major stablecoin issuer align with US enforcement expectations.
Allegations around value growth and payments to the Lutnick family
Beyond compliance processes, Blumenthal’s questions focus on financial terms and outcomes for Lutnick-associated interests. The letter notes that Cantor acquired rights to a 5% stake in Tether in 2024, and it alleges that Cantor custodies tens of billions of Tether-linked US Treasury bill reserves.
Blumenthal further alleges that Cantor’s Tether-related stake increased in estimated value from $600 million to $10 billion since Trump returned to office, and that Howard Lutnick received more than $250 million during that period, including a $192 million distribution from Cantor Fitzgerald.
These claims are presented as allegations in the senator’s letter and are tied to the investigation’s broader concerns about the stablecoin’s role within the financial system.
Democratic investigators’ prior concerns about USDT and Iran-linked networks
The new letter follows earlier Democratic investigation work reported last month by the Senate Permanent Subcommittee on Investigations. That earlier reporting alleged that Tether’s USDt (USDT) has become a “key tool” for Iran’s shadow banking network, according to prior coverage referenced by Cointelegraph.
In response to the broader concern, Tether has said it has worked with law enforcement for years and reported that it has frozen nearly $550 million in Iran-linked USDT this year. Cointelegraph also previously reported Tether’s statement about freezing funds connected to an Iran-linked illicit finance case.
Blumenthal’s latest letter echoes that line of reasoning, arguing that if USDT has been used in illicit activity, then firms earning revenue from the ecosystem—such as Cantor through its stake and reserve custody role—should be subject to closer examination.
Timeline of involvement and divestment questions
According to the article, Cantor’s relationship with Tether dates back to 2021, when it began acting as custodian for a portion of the US Treasuries backing Tether’s reserves.
Howard Lutnick oversaw Cantor during this period and helped negotiate Cantor’s investment in Tether in April 2024, the coverage says. The timeline then shifts with Lutnick’s move into government: he stepped down from Cantor after the Senate confirmed him as commerce secretary in February 2025. Cantor then named his son Brandon as chairman and his other son as vice chairman.
Blumenthal’s latest request also extends beyond Tether’s reserve structure. He asked for details of the terms and process around Howard Lutnick’s divestiture from Cantor, including whether there were any loans or financing provided by Tether to Lutnick or his family to facilitate the transfer of ownership to his children.
The senator also sought answers on whether Cantor requires independent audits of Tether, whether Cantor has ever reviewed options for terminating the partnership, and what steps Cantor has taken to investigate allegations of illicit finance and sanctions evasion.
What happens next for Cantor and US stablecoin compliance oversight
Blumenthal asked Cantor to respond by Oct. 23, setting a clear deadline for the bank to produce records and address the compliance and governance questions. For market participants, the key unknown is how Cantor documents its oversight of Tether’s legal compliance—particularly given the Senate’s focus on potential sanctions and illicit finance linkages—and whether regulators will treat custodial and investment arrangements around stablecoins as a broader enforcement priority.
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