The rate at which crypto scams are increasing is alarming. What is more shocking is that notable people have also become abettors to these fraudulent schemes. The latest person to find himself embroiled in the crypto scam controversy is John McAfee.
McAfee has long been one of the major supporters of cryptocurrency. He was the founder of a software company that goes by the name McAfee Associates but later resigned. Since leaving this company, he has had a number of programming companies like Tribal Voice, Future Tense Central etc. to his credit.
The US Federal officials charged John McAfee and Jimmy Gale Watson, his executive advisor, with securities fraud. The fraudulent activity is a pump and dump crypto scheme. According to federal officials, the digital tokens were bought for cheap only to be sold at artificially inflated prices.
He and his executive director have been accused of earning up to $2 million by scamming people. They encouraged Twitter followers to invest in tokens such as the Dogecoin and Reddcoin and sold their own holding as the prices increased.
Audrey Strauss, US Attorney in a statement told that McAfee and Watson used a social media platform to deceive investors. She further added that they purportedly published messages regarding crypto investments, on McAfee’s Twitter account, thereby reaching thousands of his followers. They touted different tokens through untrue and deluding statements for their own ulterior motives.
According to the investigations, the scheme ran between 2017 December to 2018 October, using McAfee’s verified Twitter account has 1 million followers.
The two accused are charged with seven accusations with each having an imprisonment between five and twenty years. The charges include financial fraud, and conspiracy to carry out securities fraud, and money laundering.
The Securities and Exchange Commission already sued McAfee last year for deceitfully endorsing initial coin offerings of better known as ICOs. In 2019 a court ordered him to pay $25 million for purportedly being involved in the killing of his neighbors in Belize. However this allegation was denied by him, nonetheless it just adds to his list of alleged crimes.
Moreover, he is currently held back in Spain on a separate criminal charge of tax evasion. The federal officials revealed that McAfee failed to pay taxes on the millions he had made by fraudulently promoting cryptocurrencies.
While his partner in crime, Jimmy Watson has been arrested, McAfee remains in Spain fighting his extradition battle.
Such incidents make it even more essential for countries to regulate cryptocurrency. While the digital asset is garnering all the attention, one is only left thinking if it is even as secure and safe as it used to be initially. Each day scammers, fraudsters, and hackers are coming up with new ways to dupe crypto users and investors, alike.