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As President-elect Donald Trump takes an unconventional approach to stocking his cabinet, he’s also embracing one candidate pool that has plenty of precedent: Wall Street chief executives.
On Friday, Trump picked Scott Bessent, a top economic adviser and the founder of Key Square Group, a hedge fund, to be his Treasury secretary. He previously tapped Howard Lutnick, the chief executive of the financial services firm Cantor Fitzgerald, for commerce secretary.
Executives appointed to government positions are often required to make extensive stock divestitures, so the path from Wall Street to Washington can be particularly complex (while also offering an opportunity to avoid certain taxes).
Bessent’s potential departure from Key Square may trigger “key man provisions” that often protect clients of hedge funds if top executives leave. And Lutnick is inextricably linked with Cantor Fitzgerald: He was named its president in 1991 and steered the firm after it was ravaged by the Sept. 11 attacks in 2001.
Here is what we know — and don’t know — about how Bessent and Lutnick plan to unwind.
Lutnick would leave Cantor Fitzgerald. He said Thursday that, upon Senate confirmation, he would step down from the company and the two firms it spun out: BGC Group, a brokerage firm, and Newmark, a real estate firm.
He’d be leaving during BGC’s ambitious push to take on the exchange giant CME Group — likely a reason that BGC’s shares were down 8 percent for the week. Shares of Newmark were up 1 percent.
