BroadChain News, April 24, 17:30 - Cryptocurrency billionaire Justin Sun is attempting to maintain friendly relations with Donald Trump while taking a tough stance against his business partners. In a lawsuit filed on Tuesday, Sun accused executives of World Liberty Financial (WLFI) of fraud, theft, and other illegal activities. The complaint does not pile up obscure legal jargon but directly points to the company facing "imminent bankruptcy."
Sun directed his sharpest accusations at WLFI co-founder Chase Herro, calling him a "repeat offender" and a "tax evader." The complaint reveals that as early as 2010, Herro had defrauded clients and business partners, leading victims to create an exposure website called ChaseHeroScam.com. Additionally, Herro has received four federal tax liens, and a property he owned in Florida was transferred due to unpaid taxes. The complaint also claims that Herro "openly boasted" about visiting the private Little St. James Island of the late financier Jeffrey Epstein.
One of the core allegations in the complaint is that WLFI "secretly" upgraded the smart contract of its governance token, WLFI. According to company documents, WLFI holders were originally only allowed to vote on underlying technical upgrades and had no authority to intervene in company operations. However, Sun accuses WLFI executives of unilaterally implementing two technical upgrades without any governance vote or disclosure to holders, adding functions to "freeze" and "confiscate" WLFI tokens. Sun claims that this function has been used to freeze his held tokens, and that the company "buried this function deep in the code" without informing holders. WLFI responded that the freeze function is only used to protect users and accused Sun's misconduct of forcing them to take action.
The complaint also reveals another trigger for the dispute: the TRUMP meme coin. WLFI executives stated that one reason for freezing Sun's tokens was his opposition to Sun's purchase of $100 million worth of TRUMP tokens—a token issued by another Trump-endorsed project. However, the complaint points out that this purchase "had been pre-approved by a member of the Trump family," who is also a partner in both projects.