Melania Trump Named in Memecoin Fraud Lawsuit
▼ Summary
– A cryptocurrency promoted by Melania Trump was allegedly part of a sophisticated fraud that used celebrity associations to mislead investors, according to a new legal filing.
– Investors filed a class action lawsuit accusing Benjamin Chow and Hayden Davis of orchestrating a multimillion-dollar pump-and-dump scheme involving multiple coins, including $MELANIA and $LIBRA.
– The scheme involved a repeatable six-step playbook where Meteora provided technical infrastructure and Kelsier supplied capital and promotional campaigns, leveraging public figures for credibility.
– The plaintiffs claim the defendants used a network of “sniper” wallets to buy coins at low prices and dump them on the market, causing millions in losses to unsuspecting investors.
– The case could set important legal precedents for token launches and disclosures in the US, with significant interest from the crypto and regulatory communities.
A newly filed legal complaint alleges that a cryptocurrency promoted by former First Lady Melania Trump in January was part of an elaborate fraud scheme designed to exploit celebrity associations and mislead investors. The case, which could set important precedents for token launches and disclosure requirements in the United States, is reportedly being monitored by both the crypto industry and regulatory bodies.
In April, cryptocurrency investors initiated a federal class action lawsuit targeting Benjamin Chow, cofounder of the Meteora crypto exchange, and Hayden Davis, cofounder of venture capital firm Kelsier Labs, among other defendants. They stand accused of orchestrating a multimillion-dollar fraud involving the memecoin $M3M3. The plaintiffs later broadened their allegations to include racketeering, claiming the defendants also manipulated the market for $LIBRA, a coin endorsed by Argentine President Javier Milei that plummeted shortly after its debut.
This week, the plaintiffs requested court approval to file a second amended complaint, relying on information from an anonymous whistleblower. The proposed filing asserts that Chow and Davis, with Chow acting as the “commander,” systematically launched, artificially inflated, and then dumped at least 15 different cryptocurrencies, including the token $MELANIA. The alleged scheme reportedly inflicted millions of dollars in losses on unsuspecting investors.
Although Melania Trump is not named as a defendant, the complaint describes her involvement as providing “window dressing for a crime engineered by Meteora and Kelsier.” The document clarifies that the plaintiffs are not accusing Trump or Milei of operating the fraudulent scheme themselves.
Max Burwick, senior managing partner at Burwick Law, which represents the plaintiffs, remarked, “This case could clarify basic expectations for token launches and disclosures in the US. We understand many across the crypto industry and regulatory community are following closely.”
Requests for comment from the White House, Benjamin Chow, and Hayden Davis were not immediately returned.
According to the investors, by the time Chow and Davis introduced the $MELANIA token in January, they had perfected a “repeatable six-step ‘playbook’ for pump-and-dump fraud.” The proposed complaint outlines that Meteora manages the technical infrastructure, while Kelsier provides the capital and coordinates promotional efforts, often leveraging the perceived credibility of public figures or established brands. Together, they allegedly operate a network of “sniper” crypto wallets that purchase large volumes of tokens at artificially low prices, only to sell them off as regular market participants begin buying.
In a private conversation included as a redacted exhibit in the lawsuit, Davis reportedly told an acquaintance before the $MELANIA launch, “Going to try to tell all my buddies early. I’m about to launch the biggest token ever lol.” It remains unclear whether Davis was referring specifically to $MELANIA or to the $LIBRA token.
(Source: Wired)