House Ethics Committee fines Madison Cawthorn over handling of crypto coin
Virginia Aabram
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The House Ethics Committee has ordered outgoing Rep. Madison Cawthorn (R-NC) to pay roughly $15,000 in fines after it found evidence that he engaged in insider trading involving a cryptocurrency.
An investigative subcommittee into allegations initially made public by the Washington Examiner found that Cawthorn made speculative moves with the meme “Let’s Go Brandon” crypto coin based on information not available to the general public. The same report did not find evidence that he had an inappropriate relationship with a staff member.
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The 81-page report said Cawthorn “promoted a cryptocurrency in which he had a financial interest in violation of rules protecting against conflicts of interest,” “failed to file timely reports to the House disclosing his transactions relating to the cryptocurrency,” and that his “purchase of the cryptocurrency was on more generous terms than were available to the general public, resulting in an improper gift.”
The investigations concluded that Cawthorn should repay the $14,237.49 value of the improper gift to “an appropriate charitable organization not later than December 31, 2022,” as well as a $1,000 late disclosure fee within two weeks.
The same ethics report looked into allegations that Cawthorn engaged in an improper sexual or romantic relationship with a member of his staff but concluded there was no evidence of such a relationship or an unprofessional office environment.
The Washington Examiner’s exclusive reporting earlier this year made public Cawthorn’s involvement with the founder of a meme cryptocurrency named for the “Let’s Go Brandon” chant mocking President Joe Biden. In December 2021, Cawthorn responded to a photo with LGBCoin founder James Koutoulas with “LGB legends. … Tomorrow we go to the moon!” on Instagram. The next day, NASCAR driver Brandon Brown announced that the coin would be his main season sponsor, causing the value to spike by 75%. The value evaporated after NASCAR rejected the cryptocurrency as a sponsor, and several unidentified insiders dumped their holdings at the same time, causing the value of the coin to plummet from $570 million on Dec. 30, 2021, to zero at the end of January 2022.
Koutoulas relaunched the coin in February, after which Cawthorn spent months telling his followers to invest in the coin, though it was trading at 95% below its December peak.
“While cryptocurrency promotion, particularly of a ‘meme coin,’ may be a novel issue before the Committee, whether a Member may promote an asset in which that Member has a financial interest is not a novel question,” the Ethics Committee report said.
Cawthorn’s association with LGBCoin was only one of the scandals plaguing him during his second and final year in the House. Graphic videos and images surfaced that allegedly showed him behaving sexually with a member of his staff, but the Ethics investigation concluded that such a relationship did not exist while Cawthorn was in office.
Cawthorn courted scandal leading up to his May primary by accusing senior lawmakers of participating in cocaine-fueled orgies. He called Ukrainian President Volodymyr Zelensky a “thug,” incurred multiple traffic violations for driving with a revoked license, and tried to bring a gun onto an airplane. His reelection bid ended in a primary defeat to Chuck Edwards.
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The congressman will donate the $15,000 fine to two organizations, split evenly: the Firearms Policy Coalition and the Shepherd Brain and Spinal Cord Center in Georgia. A Cawthorn spokesperson focused on the committee finding no evidence of an inappropriate relationship with a staffer in a statement to Politico.
“Rep. Cawthorn thanks the Committee for their thorough investigation and is pleased to note that the Committee fully exonerated him of the false, malicious, and stupendously idiotic allegations of an improper relationship with staff members,” the spokesperson said.