$LIBRA scandal: Milei used presidential role to spread scam, commission concludes

A congressional commission tasked with investigating the $LIBRA crypto scandal and the involvement of President Javier Milei and his sister, Presidency Secretary Karina Milei, presented their findings on Tuesday. The report, which is not a criminal investigation and therefore cannot make direct affirmations about what happened, covered the known facts of the case and pointed to the alleged crimes the Milei siblings committed.  Among their conclusions, the commission said that Milei used his role as president to spread an “alleged scam,” that the plot involved allegedly using the president’s image for profit, and that the $LIBRA token was not the first time Milei was involved in an incident like this. The 200-page document comes after three months of deliberation in the lower house, pushed by several opposition parties. A few members of ruling party La Libertad Avanza and right-wing party PRO were also part of the commission and questioned the conclusions.  “The investigated events are compatible with an alleged scam,” Coalición Cívica deputy and commission president Maximiliano Ferraro said during the presentation of the report.  The report went on to accuse the judiciary of obstruction, saying that Judge Marcelo Martínez de Giorgi rejected their requests to access the case file and investigate evidence. They also recommended Congress debate whether Milei failed to comply with his presidential duties for spreading a private investment tool that ended in multi-million dollar losses for thousands of people. Milei is facing a judicial investigation in Argentina for his role in promoting the cryptocurrency. There is also an ongoing investigation in the U.S., where a New York law firm is leading a class action suit against him. The report The document said that Milei used his role as president to engage in what could potentially be a scam. Karina Milei’s role is pegged to her responsibility in allowing the meetings to happen, as her office controls who visits the president.  “Javier Milei used the presidential role, and Karina Milei, at the very least, offered access to official national government facilities and to the president to those involved to carry out actions that are being investigated as an alleged scam of international scope.” There is proof that Milei met with the creator and other men involved in the project 16 times in the Casa Rosada and the presidential residence. Those involved are U.S. entrepreneur and $LIBRA creator Hayden Davis, Argentine businessmen Mauricio Novelli and Manuel Terrones Godoy, and Sergio Morales, then an advisor for Argentina’s National Securities Commission (CNV, by its Spanish acronym). Novelli and Terrones Godoy allegedly are the ones who connected Milei and Davis. The report said that blockchain analysis proves there was a money flow between them as part of an “alleged cooperation agreement” to use Milei’s image for profit. The lawmakers added that this was not an isolated event, given that, in December 2024, Milei had engaged in the promotion of a token called $KIP, which is also linked to Novelli and Terrones Godoy. In addition, they pointed out that Milei has not explained how he had access to the token’s identification number, which was private until he shared it. “Without Milei’s promotion made by Milei in his official account, the $LIBRA project would not have reached the registered volume of purchases.” The case On February 14, Milei made an X post supporting a cryptocurrency token called $LIBRA, prompting many investors to buy it. Up until that moment, the token was unknown. In fact, it had been created a few minutes before Milei’s post. The post contained what is known as a “contract number” that allows would-be buyers to find the cryptocurrency, which was not listed on major trading platforms.  The price soared right out of the gates, eventually surpassing US$5 per token. The value would eventually crater to virtually nothing over the next few hours after its developers withdrew between US$80 million and US$100 million. Specialists call this a “rug pull,” a kind of scam based on convincing unsuspecting investors to back a cryptocurrency and then quickly withdrawing all funds. Around 84% of the coins were in the hands of three users, who were on the development team. In these projects, developers typically hold between 15% and 20%. The time elapsed between the token’s launch and the alleged rug pull was five hours. Despite online concerns about whether Milei’s account had been hacked, the president kept the post pinned on his profile all that time. He finally took it down after claiming to have found out about the details of the project. Milei later denied being involved in the $LIBRA project, saying he did not endorse it but merely “shared” it because it supposedly aimed at supporting local investments. He added that the post was of a “personal,” not institutional, nature. The latter was an attempt at rejecting accusations that he had violated the law by promoting a private investment as president.