Alt5 Sigma Faces Scrutiny Over Conflicting SEC Disclosures and Governance Gaps

Auditor Timeline Discrepancies Trigger Regulatory Concerns

Alt5 Sigma is back under the microscope after inconsistencies in its regulatory filings cast doubt on how transparently the company has reported major internal developments.

In a November 29 Black Friday filing, the firm told the Securities and Exchange Commission (SEC) that it had learned just days earlier, on November 21, that its independent accountant, William Hudgens, had resigned effective immediately.

But Hudgens told Forbes he informed the company long before that. According to him, he made clear before June 30 that he was stepping away from auditing public companies and would not work beyond the second quarter, which Alt5 Sigma filed in August.

The company has yet to submit its third-quarter report. In a separate November 12 filing explaining that delay, Alt5 Sigma partly blamed Hudgens’ “timeliness and responsiveness.” When questioned by Forbes about who was reviewing its financials at the time, a spokesperson declined to name anyone.

Securities law experts say the conflicting dates, combined with a late quarterly filing, could prompt closer regulatory scrutiny. Public companies are required to notify the SEC within four business days of an auditor’s resignation.

Executive Suspensions Also Show Disclosure Gaps

The issues aren’t limited to accounting. Earlier leadership changes also appear to have been disclosed later than they occurred.

Alt5 Sigma reported on October 16 that CEO Peter Tassiopoulos had been suspended by the board. But an internal email dated September 4, six weeks earlier, told employees he had already been placed on temporary leave pending a special committee’s review. The same message revealed that chief revenue officer Vay Tham had also been sidelined.

Just before Thanksgiving, Alt5 Sigma disclosed several new management changes: the termination of acting CEO and CFO Jonathan Hugh, the end of COO Ron Pitters’ consulting agreement, the resignation of board member David Danziger, and the dissolution of the special committee after it delivered its findings.

In August, Alt5 Sigma denied speculation that venture capitalist Jon Isaac was being probed over alleged inflated earnings and insider sales of shares linked to its recent $1.5 billion corporate treasury deal with WLF.