US investment bank Cantor Fitzgerald is facing scrutiny from Senate Democrats over its partnership with Tether, the stablecoin issuer. Senator Richard Blumenthal, ranking Democrat on the Senate's Permanent Subcommittee on Investigations, has requested records on the firm's relationship with Tether and financial gains made by Commerce Secretary Howard Lutnick's family.
In a letter sent Thursday, Blumenthal asked Cantor chairman Brandon Lutnick to explain how the firm monitors Tether's compliance with banking and sanctions laws. He also requested all communications involving Howard Lutnick about Tether, including those after he departed from Cantor.
Blumenthal characterized the arrangement as problematic, stating that "Cantor Fitzgerald's lucrative business arrangements with Tether come at the expense of America's national security."
Cantor's Stakes and Valuations
Cantor Fitzgerald acquired rights to a 5% stake in Tether in 2024 and reportedly custodies tens of billions of Tether's US Treasury bill reserves. According to Blumenthal's allegations, Cantor's stake in Tether increased in estimated value from $600 million to $10 billion since Trump returned to office. During the same period, Howard Lutnick reportedly received more than $250 million, including a $192 million distribution from Cantor Fitzgerald.
Illicit Finance Concerns
The inquiry follows a recent report by Democratic investigators on the Senate Permanent Subcommittee on Investigations alleging that Tether's USDT has become a key tool for Iran's shadow banking network. Blumenthal called on the US Treasury and Justice Department to investigate potential sanctions violations.
In response, Tether stated that it has been working with law enforcement for years and has frozen nearly $550 million in Iran-linked USDT this year.
History of the Partnership
Cantor's relationship with Tether began in 2021, when it started acting as a custodian for a portion of the US Treasuries backing Tether's reserves. Howard Lutnick, who served as Cantor's chairman and CEO at that time, helped negotiate the firm's investment in Tether in April 2024.
Lutnick stepped down from Cantor after the Senate confirmed him as commerce secretary in February 2025. The firm subsequently named his son Brandon as chairman and his other son as vice chairman.
Outstanding Questions
Beyond earnings and compliance records, Blumenthal is seeking details on the terms of Howard Lutnick's divestiture from Cantor and information about any loans or financing Tether provided to facilitate the transfer of ownership to his children. The senator has also asked whether Cantor requires independent audits of Tether, whether it has reviewed terminating the partnership, and what steps it has taken to investigate allegations of illicit finance and sanctions evasion.
Cantor Fitzgerald has been asked to respond to the inquiry by October 23. Cointelegraph reached out to both Cantor Fitzgerald and Tether but did not receive immediate responses.
