Trump’s transition chief Howard Lutnick may lead the Treasury Department

The Wall Street billionaire who heads the transition team responsible for staffing the incoming Trump administration is one of the candidates who could become the next Treasury secretary, according to a report.

Howard Lutnick, CEO of private investment bank Cantor Fitzgerald, is a top ally of Trump, leading his transition team.

Since Trump’s election victory last Tuesday, Lutnick has been gathering the names of people who will fill thousands of jobs in the incoming administration.

“We have so many candidates,” Lutnick told CNN on 31 October. “We’re so set up—I’m fine.”

Lutnick and transition team co-chair Linda McMahon are tasked with filling about 4,000 positions in the federal government. That includes everyone from the secretary of state and other heads of cabinet departments to those selected to serve part-time on boards and commissions.

About 1,200 of those presidential appointments require Senate confirmation, which should be easier now that the Senate is shifting to Republican control.

If Trump were to use Lutnick to head the Treasury Department, it could potentially pose a conflict of interest, as he would oversee possible sanctions that would be imposed on Tether, a digital stablecoin launched in 2014 that is linked to the U.S. dollar, according to the report.

In press interviews, Lutnick has promoted Tether. Cantor Fitzgerald also manages a significant portion of Tether’s reserve assets, particularly US Treasuries that back the cryptocurrency.

Lutnick could also occupy a senior post in the Trump administration that would give him influence over decisions related to cryptocurrency — posing another potential conflict of interest.

The Treasury Department has been investigating Tether since before Lutnick became involved with Trump’s campaign, sources with knowledge of the situation said told the Washington Post.

Treasury officials emphasized that any sanctions that could be imposed on Tether are not related to Lutnick’s political activities, according to the newspaper.

Cryptocurrency stocks soared in the wake of Trump’s emphatic election victory last Tuesday. During the campaign, Trump promised to appoint pro-industry officials to top posts – ushering in an era of deregulation.

Bitcoin, the largest cryptocurrency, blew past its previous record, hitting an all-time high of $83,361 per unit on Monday.

As of Monday, Tether had a market capitalization of $123.5 billion, according to cryptocurrency trading platform Coinbase.

In January Lutnick told Bloomberg News that he can personally vouch for the authenticity of Tether’s accounts, telling the financial media: “They have the money they say they have.”

But Treasury Department investigators have been looking into alleged links between the cryptocurrency and international criminals.

Tether could face sanctions by the federal government over allegations that it facilitated transactions for Mexican drug cartels.

There are also concerns that terrorist organizations such as the Palestinian group Hamas are using cryptocurrency to finance their operations.

Last October, The Wall Street Journal cited the Israeli government’s seizure orders and blockchain analytics reports indicating that Palestinian terrorist organizations such as Hamas and Islamic Jihad raised tens of millions of dollars in cryptocurrency in the months leading up to the October 7 attacks.

“Tether is being used for terrorist financing and is becoming more widely used in crypto fraud and scams,” Adam Zarazinski, CEO of cryptocurrency intelligence firm Inca Digital, told The Post in February.

The transactions were primarily processed through Tether, according to the report.

Tether officials said the $93 million reported by The Journal “is wildly overstated and inaccurate.”

For months, Tether has been under scrutiny by federal investigators who say the cryptocurrency is used by Russia to facilitate payments and to circumvent sanctions imposed on the country in the wake of its February 2022 invasion of Ukraine.

In June, the Treasury Department’s Financial Crimes Enforcement Network published a notice alleging that transnational criminal groups were using Tether and other digital currencies to purchase equipment and chemicals from Chinese suppliers.

Tether has denied the allegations.

Paolo Ardoino, CEO of Tether, wrote on X last month that there was “no indication that Tether is under investigation.”

Tether also released a statement saying it is “not aware of any such investigations into the company.”

The Post has sought comment from Lutnick, Tether and the Treasury Department.