Argentine Lawyers File Fraud Charges Against President Milei Over Libra Token Controversy

Argentina’s President Javier Milei is facing legal troubles following his endorsement of the Libra (LIBRA) cryptocurrency project, which saw a dramatic rise and fall in market value over the weekend. Lawyers have filed fraud charges against the president, while another attorney is preparing a class-action lawsuit on behalf of investors who suffered financial losses.

Fraud Charges and Legal Complaints Filed Against Milei

The controversy surrounding the Libra token began on February 14 when President Milei publicly endorsed the Solana-based token on X (formerly Twitter). The token initially soared to a market capitalization of $4.56 billion after Milei's endorsement. However, within hours of his post being deleted, Libra’s value plummeted by more than 94%, sparking accusations of a pump-and-dump scheme.

In response, Argentine lawyers Marcos Zelaya and Jonatan Baldiviezo, along with engineer María Eva Koutsovitis and economist Claudio Lozano, filed a criminal complaint against Milei on February 17. They are accusing the president of being complicit in fraud for promoting the token, which they argue misled investors.

Baldiviezo also claims that Milei violated Argentina’s Public Ethics Law, which mandates public officials disclose their asset holdings and any potential conflicts of interest. "Within this illicit association, the crime of fraud was committed, in which the president’s actions were essential," Baldiviezo said.

A judge will be assigned to the case, or it will be referred to a prosecutor for further investigation, according to the Associated Press.

Class-Action Lawsuit and Allegations of Financial Crimes

In addition to the criminal complaint, Argentine lawyer Agustín Rombolá, founder of the Rombola Mangione law firm, has filed a separate legal complaint against Milei. Rombolá, who is also a member of the Unión Cívica Radical political party, has accused the president of fraud, price manipulation, and other financial crimes.

Rombolá's firm is also preparing a class-action lawsuit on behalf of individuals who invested in Libra and subsequently lost money. The class-action suit could have significant implications for the project’s backers, as well as for Milei’s political future.

Milei Responds to Allegations

Following the token's collapse, Milei called on the Anti-Corruption Office to investigate the actions of all government officials, including himself, and to provide the findings to the courts. In a statement from the presidential office, Milei denied any wrongdoing, claiming he was unaware of the project’s full details when he endorsed it. The office also emphasized that Milei had no connection to the company behind the token.

However, Milei did confirm that he had met with representatives from KIP Protocol, a Web3 company that provided consulting services for the project, in October 2023. While KIP Protocol was involved in distributing project funds to local businesses, it has stated that it did not create the Libra token or act as a market maker for it.

Concerns Over the Token's Legitimacy

The collapse of Libra has raised further questions about the token’s legitimacy. Analysts have pointed out that the project’s website domain was created just hours before the token’s launch, and there is no public information about the project's owner. These factors have led to suspicions of potential fraudulent activity surrounding the token’s creation and promotion.

Opposition lawmaker Leandro Santoro has indicated that he will be moving forward with an impeachment request for Milei, intensifying the political fallout from the incident.

Conclusion

The Libra token’s swift rise and dramatic fall have thrust President Javier Milei into the center of a growing legal and political storm. As the investigation unfolds and legal complaints pile up, the future of both the president’s political career and the cryptocurrency project remain uncertain. The case also highlights the risks associated with political endorsements of cryptocurrency projects, which, when poorly executed, can have devastating consequences for investors.