House Ethics Committee admonishes Rep. Madison Cawthorn over crypto promotion, failure to disclose stake
- The House Ethics Committee admonished Rep. Madison Cawthorn and ordered him to pay more than $15,000 over improper promotion of a cryptocurrency and failure to report transactions in a timely manner.
- Cawthorn lost his Republican primary for his North Carolina seat earlier this year and is on his way out of Congress.
- The Ethics Committee also said an investigative subcommittee's report did not find evidence Cawthorn engaged in an improper romantic or sexual relationship with a staffer.
The House Ethics Committee on Tuesday said it admonished outgoing Rep. Madison Cawthorn and ordered the North Carolina Republican to pay more than $15,000 for violating conflict of interest rules by publicly promoting a cryptocurrency he owned and for failing to promptly disclose crypto transactions.
The Ethics Committee also said an investigative subcommittee's report did not find evidence Cawthorn engaged in an improper romantic or sexual relationship with a staffer, with whom he had been seen in videos "engaging in explicit and sexually suggestive comments and conduct."
Cawthorn's office did not immediately respond to a request for comment on the Ethic Committee's actions.
The panel's report comes nearly a month after Cawthorn reportedly vacated his Washington, D.C., and district offices. Cawthorn lost his bid for a second term in May, when he was narrowly defeated in the GOP primary by Chuck Edwards. The Republican Edwards won the general election for the 11th District seat last month.
Cawthorn's primary contest was wracked by controversy over his conduct, which included being stopped by police repeatedly for having a revoked driver's license and a misdemeanor citation for bringing a loaded handgun to an airport.
Before the primary, House Minority Leader Kevin McCarthy, R-Calif., blasted Cawthorn for claiming in a podcast interview that other members of Congress had invited him to orgies and done cocaine in front of him.
Days after Cawthorn lost to Edwards, the Ethics Committee revealed it was probing the representative for possibly improper promotion of the so-called Let's Go Brandon coin and for a possible improper relationship with a staffer.
Just four days after the investigation came to light, Cawthorn belatedly disclosed in public filings that he bought Let's Go Brandon cryptocurrrency on Dec. 21. He made the purchase eight days before he wrote a Dec. 29 Instagram post that said, "Tomorrow we go to the moon," in response to a photo of him posing with co-founders of the coin.
In the same filing, Cawthorn belatedly disclosed that he had bought Ethereum cryptocurrency in December 2021.
The disclosure came five months after the crypto transactions. By law, members of Congress must disclose purchases and sales of stocks, bonds, commodity futures and other securities within 45 days of when they took place.
In its report Tuesday, the Ethics panel said that the investigative subcommittee found that Cawthorn's purchase price of $150,000 for 180 billion Let's Go Brandon coin "was on more generous terms than were available to the general public, resulting in an improper gift."
That subcommittee did not reach a conclusion on whether the congressperson had intended to personally profit from his promoting the LGB coin on Dec. 29.
The dollar value of that crypto, whose name comes from a derogatory phrase about President Joe Biden, rose by 75% a day after Cawthorn's post based on news of the coin's sponsorship deal with NASCAR driver Brandon Brown. The value of the coin collapsed after NASCAR barred that deal from taking effect.
The Ethics panel directed Cawthorn to repay $14,237.49 to a charitable organization no later than Dec. 31, remit late fees of $1,000 to the Treasury Department and submit a transaction report disclosing his Jan. 17 sale of some of his LGB coin holdings.
The late fees relate to Cawthorn's failure to file the required disclosures of his crypto holdings and transactions.
The Ethics Committee said the subcommittee's report found that Cawthorn's failure to file those disclosures was not done "knowingly or willfully," but instead was based on incorrect advice from an accountant about the disclosure requirements.
"Based on the totality of his conduct, including his repeated and knowing promotion of a cryptocurrency in which he held a financial interest, the Committee also determined that Representative Cawthorn acted in a manner that did not reflect creditably upon the House, in violation of clause 1 of the House Code of Official Conduct," the panel said.
In regards to its inquiry into the relationship between Cawthorn and his staffer, the Ethics Committee said "both denied having any romantic or sexual relationship."
"All witnesses interviewed by the [subcomittee] also stated there was no improper relationship between the two, and that the close relationship between Representative Cawthorn and this individual did not create an unfair work environment," the panel said.
The subcommittee also found that the images that sparked the inquiry were taken before Cawthorn was sworn in as a member of Congress and therefore were outside of the panel's jurisdiction.