Antivirus software pioneer McAfee charged by U.S. with cryptocurrency fraud

Antivirus software pioneer McAfee charged by U.S. with cryptocurrency fraud

By Jonathan Stempel and Chris Prentice

NEW YORK/WASHINGTON (Reuters) – John McAfee, the antivirus software pioneer whose previous company nonetheless bears his title, has been indicted on fraud and cash-laundering conspiracy prices stemming from two cryptocurrency schemes, the U.S. Justice Section explained on Friday.

Authorities accused McAfee and his bodyguard, Jimmy Gale Watson Jr., of exploiting McAfee’s big Twitter next to artificially inflate selling prices of “altcoins” by a so-called pump-and-dump scheme, and concealing payments McAfee gained from startup companies to endorse original coin offerings.

The Justice Section stated McAfee and his accomplices reaped a lot more than $13 million from the schemes. The expenses were being brought in Manhattan federal court docket.

The Commodity Futures Trading Commission submitted similar civil prices relating to the alleged pump-and-dump plan.

Manhattan U.S. Attorney Audrey Strauss reported in a assertion: “As alleged, McAfee and Watson exploited a greatly made use of social media system and enthusiasm between investors in the rising cryptocurrency market place to make hundreds of thousands as a result of lies and deception.”

Attorneys for McAfee could not right away be recognized. McAfee is getting detained in Spain subsequent his arrest there on tax evasion prices declared in October, the Justice Division stated.

Watson was arrested on Thursday evening in Texas, the department extra.

Watson’s legal professional Arnold Spencer claimed in a assertion: “Jimmy Watson is a embellished veteran and previous Navy Seal. He fought for other people’s legal rights and liberties, and he is entitled to and seems ahead to his day in court docket to exercising some of people extremely rights.”

Equally also encounter civil costs by the U.S. Securities and Exchange Fee, which in Oct accused McAfee of concealing far more than $23.1 million he designed from boosting seven cryptocurrency offerings on Twitter.

In the cryptocurrency circumstances, authorities stated McAfee touted property which include Verge, Reddcoin and Dogecoin as component of a “Coin of the Working day” or “Coin of the Week” tweet from all over December 2017 by means of February 2018.

Authorities claimed McAfee held himself up as an professional on cybersecurity and cryptocurrency by means of his tweets, speeches and his part as a CEO of a publicly traded cryptocurrency company. They also accused him of telling followers he experienced no stake in the cash, even as he touted how they “will transform the environment.”

(Reporting by Jonathan Stempel in New York and Chris Prentice in Washington Enhancing by Matthew Lewis and Will Dunham)