2021-03-06 11:33:50

Anti-virus software creator John McAfee charged with fraud in cryptocurrency scam | World News

Anti-virus software creator John McAfee has been charged in the US with conspiracy to commit fraud and money-laundering.

The charges relate to two cryptocurrency schemes, the US Justice Department said on Friday.

Authorities said McAfee and his bodyguard, Jimmy Gale Watson Jr, exploited McAfee’s large Twitter following to artificially inflate prices of “altcoins” through a so-called pump-and-dump scheme, and concealed payments McAfee received from start-up businesses to promote initial coin offerings.

McAfee, who designed software of the same name, was reportedly arrested in Barcelona in October 2020 while boarding a flight to Istanbul using a British passport.

The Justice Department, which brought the charges in a Manhattan federal court, said McAfee and his accomplices reaped more than $13m (£9.4m at current prices) from the schemes.

Related civil charges were filed by the Commodity Futures Trading Commission concerning the alleged pump-and-dump scheme.

Manhattan US Attorney Audrey Strauss said in a statement: “As alleged, McAfee and Watson exploited a widely used social media platform and enthusiasm among investors in the emerging cryptocurrency market to make millions through lies and deception.”

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Lawyers for McAfee have not, at this stage, been identified for comment. McAfee is still being held in Spain following his arrest there on tax evasion charges, the Justice Department said.

Watson was detained on Thursday night in Texas, the department added.

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McAfee, 75, is a famous libertarian who believes that tax is wrong

Watson’s lawyer Arnold Spencer said in a statement: “Jimmy Watson is a decorated veteran and former Navy Seal. He fought for other people’s rights and liberties, and he is entitled to and looks forward to his day in court to exercise some of those very rights.”

Both also face civil charges by the US Securities and Exchange Commission, which in October accused McAfee of
concealing more than $23.1m (£16.7m at current prices) he made from boosting seven cryptocurrency offerings on Twitter.

McAfee, 75, is a famous libertarian who believes that tax is wrong and has in the past boasted of not paying his taxes.

He launched a presidential campaign in the US in 2018, but failed to gain any traction as an independent candidate or as one for the Libertarian Party.

In the cryptocurrency cases, authorities said McAfee promoted assets like Verge, Reddcoin and Dogecoin as “Coin of the Day” or “Coin of the Week” at points between around December 2017 and February 2018.

Authorities said McAfee presented himself as an expert on cybersecurity and cryptocurrency through his tweets, speeches and his role as a CEO of a publicly traded cryptocurrency company.

They also accused him of telling followers he had no stake in the coins, even as he touted how they “will change the world”.

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