Rep. Cawthorn was fined for a breach of ethics over a promotion for the “Let’s Go Brandon” token.
The House Committee on Ethics has fined outgoing US House Representative Madison Cawthorn more than $15,000 for promoting a cryptocurrency in which he had an undisclosed investment.
After a seven-month investigation, the Committee released a report on Dec. 6, saying that Cawthorn “improperly promoted a cryptocurrency in which he had a financial interest,” which is against the rules about conflicts of interest.
Cawthorn’s “direct and clear” promotion on social media came after the representative bought $150,000 worth of the token in December 2021 without saying so.
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He promoted the Ethereum-based token Let’s Go Brandon (LETSGO), which is named after a slogan and meme that is used as a substitute for “F—- Joe Biden.” Cawthorn was able to buy around 180 billion LETSGO tokens “on better terms than the general public could get them.”
Cawthorn gave $150,000 to a person who worked with the token but didn’t want to be named. In return, he got 180 billion LETSGO, which were worth an average of about $164,200 at the time. Cawthorn also didn’t pay any fees to do business.
The difference between how much Cawthorn paid and how much the tokens were worth on average when he got them was $14,237. The committee called that a “gift” and told Cawthorn to give that amount to “an appropriate charitable organisation.”
After buying the tokens on December 21, 2021, Cawthorn sold “almost all” of them in three groups. By the end of January 2022, he had lost almost $7,500.
The Committee could not agree on whether Cawthorn intended to “personally profit from his promotional activities,” and there was not “sufficient evidence” that Cawthorn used non-public information to time his transactions.
The report said that Cawthorn also didn’t tell the House about his cryptocurrency transactions when he should have. But the report says that crypto disclosure requirements are “relatively new,” so the Committee decided that Cawthorn’s failure to disclose was not “knowing or willful” because he was “misinformed about the requirements.”
Along with his over $14,000 donation to charity, the outgoing representative will also have to turn in a transaction report that shows how the tokens were bought and sold. He will also have to pay a $1,000 late fee.
Cawthorn said he still owns more than 15.3 billion LETSGO, which is worth less than $25.50 right now, according to data from CoinGecko.
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The Representative will leave office in January 2023, after only one year representing North Carolina’s 11th Congressional District. North Carolina Senator Chuck Edwards beat him in a Republican Party primary in May.
