US Congressman Accused of Crypto Pump & Dump; May Face Charges

Paigambar Mohan Raj
Source: ABC News

Madison Cawthorn, who is a Republican representative from North Carolina, has been accused of being involved in a crypto pump and dump scheme involving the coin Lets Go Brandon (LETSGO).

Pioneered by James Koutoulas, Lets Go Brandon is a memecoin named after the chant that is used to mock US President Joe Biden.

Several regulatory agencies have accused Cawthorn of being involved in an alleged insider trading conspiracy concerning the short-lived crypto project.

On the 29th of December, 2021, Cawthorn took to Instagram to say,

“LGB legends. … Tomorrow we go to the moon!”

Oddly enough, on the 30th of December, NASCAR driver Brandon Brown said that the Lets Go Brandon crypto project will be his principal sponsor for the 2022 season. The announcement sparked a major uproar, and the LETSGO token jumped by 75%, while also reaching a market worth of $570 million.

However, Brown’s sponsorship arrangement with the project was rejected by NASCAR in January 2022. Unidentified insiders who had bought a large number of the crypto coins in circulation soon sold them all.

The memecoin’s value plummeted to zero as a result, leaving investors in despair. Koutoulas and other Let’s Go Brandon insiders are accused of manipulating the token to orchestrate a pump-and-dump scam, according to a class-action lawsuit filed by an unhappy investor.

While Cawthorn was not listed as a defendant in the complaint, he was recognized as one of the project’s backers who had helped inflate the project’s price immediately before it was dumped.

Cawthorn, according to the watchdogs quoted in the report, had advanced non-public information of LETSGO’s contract with Brown, which explains his post and sentiments. They proposed that the US Department of Justice and the Securities and Exchange Commission (SEC) examine Cawthorn to see whether he broke any federal insider trading rules.

One of the federal watchdogs’ government affairs managers, Dylan Hedtler-Gaudette, said:

“This looks really, really bad. This does look like a classic case of you got some insider information and acting on that information. And that’s illegal.”

The crypto project was relaunched after its failure in January, but has failed to take off. Despite Koutoulas saying that the project now had measures to prevent whales from selling all of their stock at once, LETSGO is currently trading at roughly 95% below its high.