Trump's Memecoin: Public Citizen Accuses Ex-President of Breaking Federal Laws

Consumer advocacy group Public Citizen has accused former U.S. President Donald Trump of violating federal laws by promoting his memecoin on social media. In a letter to the U.S. Department of Justice and the Office of Government Ethics, the group alleged that Trump's posts on his Truth Social platform were tantamount to soliciting gifts, which is prohibited for public officials.

The group pointed to a 2012 report from the Congressional Research Service, which states that while the president is exempt from restrictions on receiving gifts from the general public, they are not allowed to solicit or coerce the offering of gifts or accept them in exchange for official acts. Public Citizen argued that Trump's posts, which encouraged his followers to buy the memecoin, constituted a violation of this rule.

The memecoin, called TRUMP, was launched just before Trump took the oath of office on Jan. 20. Public Citizen alleged that Trump's continued promotion of the coin on his social media platform was a violation of federal laws. The group called on the Justice Department and the Office of Government Ethics to investigate the memecoin and whether foreign state actors may be purchasing the token.

The Justice Department is currently led by Attorney General Pam Bondi, who was appointed by Trump. Former President Joe Biden nominated David Huitema to lead the Office of Government Ethics. However, the U.S. Supreme Court's 2024 decision making the president presumptively immune from prosecution over official acts may complicate any potential investigation.

Public Citizen requested recommendations, including the termination of the meme sale and the return of funds to all who purchased the TRUMP coin. The market capitalization of TRUMP rose to more than $15 billion in less than 48 hours after its launch on Jan. 17, though it has since fallen to roughly $3.7 billion at the time of publication. The team behind the token controls 80% of the total supply, raising concerns about a potential "rug pull" scam.