Eric Trump Agrees to Step Back from World Liberty Financial’s Crypto Bank Amid Regulatory Scrutiny
World Liberty Financial's proposed crypto bank has received preliminary approval from federal regulators. However, to address concerns over potential conflicts of interest, Eric Trump and other major investors have agreed to limit their influence over the bank.
The commitments, known as passivity agreements, will keep Eric Trump, co-founder Zak Folkman, and Emirati investor Hamad Khalfan Ali Matar Alshamsi away from management decisions. This move aims to ensure that particular investors do not control the trust bank.
David Wachsman, a World Liberty spokesman, emphasized that the company is intentionally working towards regulation and permanent supervision. 'Before full approval and for many years afterward, the World Liberty Trust Company will fully cooperate with the OCC, a federal regulator, and will adhere to all other applicable laws and regulations,' he said.
The proposed crypto bank's ownership structure has raised concerns due to its ties to Trump's family and overseas money. The company had previously made an agreement to sell 49% of its ownership to a business associated with Sheikh Tahnoon bin Zayed, brother to the UAE president.