RALEIGH, N.C. (WGHP) — A North Carolina senator is weighing in on the latest in an avalanche of issues for a congressman.
“Insider trading by a member of Congress is a serious betrayal of their oath, and Congressman Cawthorn owes North Carolinians an explanation. There needs to be a thorough and bipartisan inquiry into the matter by the House Ethics Committee. #ncpol”
The Washington Examiner wrote that Madison Cawthorn is under fire after posing with hedge fund manager James Koutoulas, who was the “ringleader” of the “Let’s Go Brandon” cryptocurrency on Dec. 29. The next day, NASCAR driver Brandon Brown announced his partnership with the LGBCoin, which caused the value to spike.
Watchdog groups, The Washington Examiner writes, believe that this signals that Cawthorn knew about the endorsement before it was announced, therefore knew ahead of time that Brown’s involvement would inflate the value. It did. The Let’s Go Brandon coin in circulation quickly became valued at $570 million.
By end of January, the value of the coin dropped to essentially nothing. Koutoulas blamed this on NASCAR rejecting Brown’s endorsement of LGBCoin. But in the middle of January “unidentified insiders that owned an outsize share of the coin dumped all their holdings at once, causing the coin’s market value to evaporate.”
This is what’s known in trading as a “pump-and-dump,” when investors use tactics to inflate the value of a stock or cryptocurrency (such as, in this case, celebrity endorsements) and then quickly sell large swaths of the stock, cashing in on the fake value before the value crashes, so they come away with a lot of money while the people who bought it essentially have something worthless.
This isn’t the first time that Cawthorn has faced scrutiny. He was cited for bringing a gun to CLT, has been cited for speeding and driving with a revoked license multiple times, claimed that people in Congress invited him to orgies and called the president of Ukraine a “thug.”
This isn’t the first time a North Carolina representative has been implicated in insider trader accusations. North Carolina Senator Richard Burr was under fire for accusations of insider trading at the beginning of the pandemic.