The Trump administration's strong support for high-tech sectors like artificial intelligence (AI) has sparked controversy among Democrats, with Commerce Secretary Lutnick now under fire for allegedly leveraging policy tailwinds for personal gain.
On Thursday, October 18, U.S. congressional correspondence revealed that 25 Democratic lawmakers are pushing for an investigation into potential conflicts of interest involving Lutnick. Led by Senator Elizabeth Warren, the group sent a letter to Acting Inspector General Duane Townsend of the Commerce Department, demanding scrutiny over whether Lutnick violated ethics rules by using his position to advance AI data center projects that benefit his family.
The lawmakers raised concerns that Lutnick's official actions promoting data center development may be influenced by conflicts of interest, potentially enriching his family while saddling ordinary Americans with higher energy costs. Lutnick previously owned and led financial services firm Cantor Fitzgerald, which holds stakes in real estate brokerage Newmark Group Inc.—a company providing leasing services for data centers.
Earlier media reports on Thursday noted that Lutnick's transfer of Cantor shares wasn't completed until early October, and that he had received an ethics waiver from the Trump administration. A Commerce Department spokesperson responded that Lutnick has fully complied with his ethics agreement regarding asset divestiture and recusal, including selling his Cantor and Newmark holdings. Cantor spokesperson Stan Neve dismissed the allegations, stating the firm's support for tech and infrastructure investors predates Lutnick's government role by years.
Core Democratic Concerns The letter, spearheaded by Representative Madeleine Dean and Senator Warren, calls for an investigation into "apparent conflicts of interest" between Lutnick's family and AI data center ventures. Lawmakers wrote: "With the billionaire Lutnick family heavily invested in data centers—whose power demands are driving up utility costs nationwide—there's significant public interest in ensuring Secretary Lutnick isn't violating federal ethics laws to advance projects that enrich his family while increasing working-class Americans' living expenses."
They highlighted that Lutnick's sons now control Cantor, creating an unusual situation where the Commerce Secretary's office intersects with his family's financial interests.
Family Ties to Data Center Industry Cantor's data center investments primarily flow through Newmark, where Lutnick previously served as chairman and his son Kyle remains a board member. Newmark credits "unprecedented data center expansion" for record profits, while Cantor—under Lutnick's sons—is projected to post $2.5 billion revenue, up 25% year-over-year.
The letter cites reports suggesting Lutnick promoted AI data centers in ways that could benefit his family, including pressuring foreign governments to invest in U.S. facilities. Specific deals mentioned include: • A UAE AI chip export agreement where Lutnick reportedly pushed for Emirati data center construction in exchange for eased chip export controls—a deal potentially benefiting Newmark. • A Korean trade pact where a startup paid Lutnick-linked firms millions to secure financing and land for data centers, raising concerns about preferential treatment for family-connected clients.
Energy Cost Impacts While lucrative for the Lutnick family, lawmakers note the data center boom has made utilities less affordable nationwide. "Power-hungry data centers are driving electricity costs to historic highs," they wrote, with some communities seeing bills surge over 250% in five years as utilities pass infrastructure costs to households.
Investigation Requests Democrats seek Inspector General review of: • Whether Lutnick violated one-year recusal obligations involving Cantor post-resignation; • Reasons for missing his May 19 divestiture deadline, completing transfers only by October 6; • Terms and enforcement of his ethics waiver; • Any pre-October 6 involvement in Cantor/Newmark-related matters; • Participation in AI data center decisions; • Communications between his office and Cantor executives regarding data centers.
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