Overview of the Allegations

Title: Accusations Against Meteora Founder Benjamin Chow in $57 Million Memecoin Fraud Involving Celebrity Endorsements

Meteora Founder Accused of Using Melania Trump, Milei for $57M Memecoin Scam

Summary:
A class action lawsuit in New York claims that Benjamin Chow, co-founder of Meteora, executed a fraudulent scheme involving celebrity endorsements from Melania Trump and Argentine President Javier Milei, resulting in losses of over $57 million for retail cryptocurrency investors. The lawsuit describes a detailed playbook used to manipulate multiple tokens and seeks significant compensatory damages and other remedies.

Key Takeaways:

Benjamin Chow is accused of leading a fraud scheme that defrauded investors of $57 million using celebrity endorsements.
The lawsuit details a systematic approach, involving the manipulation of multiple tokens like $LIBRA and $MELANIA.
Chow resigned amid controversy in February 2025, facing serious legal challenges under RICO statutes.
The situation raises concerns about celebrity involvement in cryptocurrency ventures and market integrity.

A class action lawsuit filed in the Southern District of New York claims that Benjamin Chow, the co-founder of Meteora, orchestrated a fraudulent scheme that leveraged endorsements from celebrities such as Melania Trump and Argentine President Javier Milei. This scheme allegedly defrauded retail crypto investors of at least $57 million.

The Second Amended Class Action Complaint asserts that Chow and his associates operated the so-called Meteora-Kelsier Enterprise as a “fraud factory,” camouflaged as a decentralized finance initiative. They utilized the Meteora liquidity-pooling protocol on Solana to facilitate pump-and-dump operations across various tokens, including $M3M3, $LIBRA, $MELANIA, $ENRON, and $TRUST.

Investors Omar Hurlock, Anuj Mehta, and John Winslow claim that the defendants exploited technical features like whitelists and freeze/thaw toggles. This allowed them to acquire a substantial portion of the token supplies at minimal cost and create artificial price increases through undisclosed paid influencers.

A forensic investigation uncovered a central wallet identified as 0xcEA, which consistently funded deployer wallets, managed token creation, provided initial liquidity, and supported sniper wallets that seized early token supplies.

Token Manipulation

Breakdown of the Fraud Strategy

The complaint outlines a comprehensive playbook that was employed across all the manipulated tokens.

The process begins with the creation of a narrative that borrows from celebrity fame. This is followed by rigging token supply through insider accounts that execute early orders. The strategy includes creating hype using undisclosed Key Opinion Leaders and engineering price spikes by pausing public trading until the insiders have secured their positions.

The execution phase involves selling off large positions while draining liquidity from the market, then reviving the scheme with new narratives using previously used methods.

An example of this strategy is seen with the $LIBRA token fraud. In February 2025, a verified post from President Milei shared the contract address at the moment token pools opened, leading to a rush of retail investors. The $LIBRA initiative falsely presented itself as a patriotic effort to support small businesses in Argentina.

Shortly after its launch, the deployer wallet withdrew over $110 million in USDC stablecoin, effectively destabilizing the token and collapsing its price just as Milei's post was retracted.

Similarly, the $MELANIA token was marketed as the official meme coin endorsed by Melania Trump, boasting sales mechanisms that claimed to prevent market dumping. Wallets tied to the Meteora-Kelsier network managed to acquire about one-third of all tokens within minutes before launch, enabling insiders to cash in for significant profits as market capitalization fell over 90% shortly thereafter.

Hayden Davis, CEO of Kelsier Ventures and co-founder of both $LIBRA and $MELANIA, mentioned in a YouTube interview that “we sniped our own coin to prevent snipers from sniping our own coin.”

Developments in Legal Proceedings

In February 2025, Ben Chow resigned from Meteora amidst the $LIBRA controversy. Jupiter co-founder Meow expressed confidence in Chow’s character but criticized his judgment regarding critical aspects of the project.

A leaked video revealed a conversation where Dhirk, founder of DeFiTuna, alerted Chow to misconduct by Davis, causing Chow noticeable distress as he reflected on his role in enabling the situation.

The lawsuit alleges that Chow possessed specific expertise in controlling technology related to liquidity pools, fee routing, trading parameters, and selectively freezing or thawing trading.

Kelsier Labs secretly committed around $2 million to Meteora, creating a pay-to-play scenario.

Fraud Allegations

Whistleblower communications indicate that Hayden Davis acted under Chow’s direction on over fifteen token launches, suggesting a centralized control over operations.

The complaint lays out seven causes of action, encompassing fraud, conspiracy to defraud, and violations of RICO statutes for a pattern of racketeering involving thousands of wire fraud acts, alongside deceptive practices under New York General Business Law and claims of unjust enrichment.

This lawsuit comes amid broader scrutiny of the Trump family’s involvement in cryptocurrency ventures, which reportedly reaped $1 billion in pre-tax profits over the past year, with tokens like $TRUMP and $MELANIA generating about $427 million. Both tokens saw sharp declines during the presidential inauguration, with $MELANIA's market cap dropping from $2 billion to $790 million.