The U.S. SEC has charged John McAfee for promoting ICOs on Twitter. Meanwhile, McAfee has been arrested in a Spanish airport on allegations of tax evasion, according to the DoJ.
October 6, 2020 | AtoZ Markets – Cybersecurity software developer John McAfee has been detained at an airport in Spain and is facing extradition. McAfee, 75, was arrested in Barcelona on Saturday while boarding a flight to Istanbul using a British passport. According to Reuters, he has now been moved to Madrid, where he will face an extradition process to the US.
The Department of Justice (DoJ) has unsealed a criminal indictment against the software mogul over charges that he willfully failed to file tax returns and tax evasion.
SEC alleges John McAfee pocketed $23M from promoting ICOs
The announcement comes as the Securities Exchange Commissions (SEC) on Monday brought civil charges against McAfee for allegedly making over $23 million in the process of shilling seven initial coin offerings (ICOs). The ICOs reportedly raised $41 million in the process with half of those proceeds pocketed by McAfee. However, the U.S. watchdog did not name the projects in the suit.
“From at least November 2017 through February 2018, McAfee leveraged his fame to make more than $23.1 million in undisclosed compensation by recommending at least seven initial coin offerings (ICOs) to his twitter followers,” the SEC alleged.
The cryptocurrency evangelist allegedly received (BTC) and ether (ETH) worth more than $11.6 million, plus an additional $11.5 million worth of promoted tokens. The SEC said McAfee leveraged his fame to make more than $23.1 million in undisclosed compensation for his promotions of seven ICOs. At the time of writing, the entrepreneur had about a million followers on twitter. The charge also stated:
“McAfee falsely claimed to be an investor and/or a technical advisor when he recommended several ICOs, creating the impression that he had vetted these companies, that they were benefitting from his technical expertise, and that he was willing to invest his own money in the ventures. In reality, McAfee’s tweets were paid promotions disguised as impartial investment advice.”
According to the filing, McAfee would typically refer to the ICOs as “investments through which investors could profit.” In a “December 2017 Interview” video available on Youtube, McAfee warned ICO investors by stating that they had to be “very careful” as there were several scammers trying to steal from these investors. The SEC claimed that this interview was a way for McAfee to distinguish his own ICO recommendations.
SEC is suing McAfee’s personal security guard
The agency is pursuing charges against Jimmy Gale Watson, Jr., a bodyguard to McAfee, on charges he aided and abetted the sale of the digital currencies, among other allegations.
The lawsuit also included charges against the former Chief Executive Officer of Team McAfee, Jimmy Gale Watson Jr. for violating U.S Securities’ law in real-time on twitter for shilling the ICOs along with McAfee. Watson allegedly assisted McAfee’s touting and scalping schemes. He negotiated deals with ICO issuers, seeking promotions, helped McAfee monetize the proceeds of his promotions, and directed his then-wife to tweet fake interest in an ICO that McAfee was promoting at the behest of the issuer.
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