John McAfee charged with cryptocurrency fraud
John McAfee and his bodyguard Jimmy Gale Watson Jr have been accused of using McAfee’s one million Twitter followers to promote and inflate the prices of cryptocurrencies, which were then sold for $2 million (£1.45 million).
Commenting on the charges, Strauss said that 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,” and advised investors to “be wary of social media endorsements of investment opportunities”.
Sweeney Jr added that the accused “used social media to perpetrate an age-old pump-and-dump scheme that earned them nearly two million dollars”.
McAfee took to Twitter to defend himself, denying that the scheme was a “pump-and-dump”.
“Much of the new allegations from the Feds are about my “coin of the day”. For a few days in 2017 I chose coins I believed had value. One of them was Doge – now being touted years later by Elon Musk. The coin has increased well over 1000% since I chose it,” he told his Twitter followers on Sunday.
At the time, he was also being sued for initial coin offerings (ICOs) in charges brought by the US Securities and Exchange Commission (SEC). On Friday, McAfee described SEC’s allegations as “overblown”.
“My team evaluated every promotion based on management, business plans and potential. No one could have foreseen the altcoin market crash. We were paid in the same coins that crashed,” he stated on Twitter, before adding: “Even as it crashed I held every single coin allocated to me. I never sold a single coin.”
McAfee is currently facing extradition to the US, while Watson Jr was arrested in Texas on Thursday.
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