Madison Cawthorn (a Republican Congressman from North Carolina) has been accused of being involved in a pump-and-dump crypto scheme dubbed Lets Go Brandon.
A Washington Examiner report recently revealed that several regulatory watchdogs have accused Cawthorn of insider trading in an alleged scheme involving the short-lived cryptocurrency project.
Let’s go Crypto Pump and Dump Scheme
Let’s Go Brandon, a memecoin, is named after the chant that mocks President Joe Biden. The project was started by James Koutoulas, a hedge fund manager.
Cawthorn wrote on Instagram “LGB legends” on December 29, 2021. Cawthorn posted on Instagram, “Tomorrow we go to the Moon!” He also acknowledged that he had a small amount of the cryptocurrency in his portfolio.
On December 30, NASCAR driver Brandon Brown announced that the crypto project would be his primary sponsor for the 2022 season. This news caused a huge buzz and the LETSGO token soared 75% to reach a market cap in excess of $570 million.
NASCAR’s January 2022 sponsorship deal with Brown was rescinded in a shocking turn of events. Unidentified insiders quickly disposed of all coins that were in circulation after they had bought a large amount.
The memecoin plummeted to zero and investors lost their minds. A disgruntled investor filed a class action lawsuit against Koutoulas, Let’s Go Brandon insiders, and accused them of using the token for a pump-and dump scheme.
Although Cawthorn wasn’t named in the lawsuit as a defendant, he was identified by the project’s endorsers as having helped to inflate the price of the project just before it was pulled.
Madison Cawthorn could face charges
According to the report, watchdogs pointed out that Cawthorn had probably gained non-public knowledge about LETSGO’s deal with Brown. Hence his post and statements. They recommended that Cawthorn be investigated both by the US Department of Justice and Securities and Exchange Commission (SEC), in order to determine whether he violated federal insider trade laws.
Dylan Hedtler–Gaudette is the government affairs manager at one of the federal watchdogs and spoke about the case:
This looks terrible. This looks like an example of insider information being used to your advantage and then acting upon it. That’s illegal.
Let’s Go Brandon Relaunches
The project’s catastrophic failure in January led to its relaunch a month later. Koutoulas claimed that the project now has safeguards to stop whales selling their stock at once.
However, the project has not been able to scale and it is currently trading at 95% of its peak price during its initial launch. Cawthorn continues to promote Let’s Go Brandon tokens in campaigns.
Image featured by The Times of Israel
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