Popular crypto-bull and software millionaire, John McAfee has been sued by SEC for promoting ICOs on social media in the past.
The United States Securities and Exchange Commission on October 5th, filed a suit against John McAfee for violating U.S. Securities law.
The software millionaire turned crypto-bull promoted at least seven initial coin offerings (ICOs) between 2017 and 2018 on Twitter to his followers without disclosing he was being paid by the ICO issuers. McAfee lied to investors by falsely denying he was being paid by the ICO issuers.
According to the suit, SEC claims that:
“From at least November 2017 through February 2018, McAfee leveraged his fame to make more than $23.1 million U.S. Dollars (‘USD’) in undisclosed compensation by recommending at least seven “initial coin offerings” or ICOs to his Twitter followers.”
McAfee was also accused of engaging in scalping in one digital asset by SEC. Scalping is a process of slowly accumulating a digital asset on a crypto exchange and later promoting it without expressing your intentions to sell it. This allows promoters to sell their digital assets quickly and profitably through market interest that they deceptively generate, which also violates U.S. securities law.
McAfee most of the time posed as a fellow investor or technical advisor to most of these ICOs he recommended without disclosing he was paid by the ICO issuers, which violates U.S. Securities law.
In another related news, the Department of Justice reports that John McAfee has been arrested in Spain for tax evasion and is presently awaiting extradition to the United States.