FILE Photo: The U.S. Securities and Exchange Commission symbol adorns an office doorway at the SEC headquarters in Washington, June 24, 2011. REUTERS/Jonathan Ernst
October 6, 2020
By Katanga Johnson and Sarah N. Lynch
(Reuters) – Federal prosecutors unsealed an indictment on Monday in opposition to John David McAfee, creator of the eponymous anti-virus computer software, in excess of costs that he evaded taxes and willfully failed to file tax returns.
The U.S. Justice Section declared the prices shortly immediately after the Securities and Trade Fee uncovered it experienced brought civil charges towards McAfee, alleging that he produced in excess of $23.1 million in undisclosed compensation from recommending 7 cryptocurrency choices on Twitter that have been materially false and deceptive.
The indictment, submitted less than seal in June, was unsealed following his arrest in Spain the place the United States is trying to get to extradite him.
He is alleged to have earned thousands and thousands in earnings from promoting cryptocurrencies, as properly as by consulting do the job, talking engagements, and promoting the rights to his lifetime story for a documentary. In spite of this earnings, the Justice Department reported he unsuccessful to file any tax returns from 2014 to 2018.
The SEC has alleged that from at minimum November 2017 via February 2018, McAfee suggested cryptocurrencies he was paid to boost, although falsely denying this kind of payments.
“McAfee leveraged his fame to make extra than $23.1 million in undisclosed compensation” by recommending at minimum seven preliminary coin choices or ICOs to his Twitter followers, the SEC said.
McAfee’s recommendations had been “materially false and deceptive,” in that he experimented with to offer “virtually worthless” cryptocurrency tokens by encouraging buyers to obtain the securities without having disclosing his personal holdings, the SEC alleged.
The SEC is searching for to impose on McAfee a civil penalty as very well as disgorgement of ill-gotten gains, with fascination. The company also desires to ban him forever from serving as an officer or director of any mentioned company or any organization that files experiences to the company.
The SEC is also pursuing charges against Jimmy Gale Watson, Jr., a bodyguard to McAfee, on expenses he aided and abetted the sale of the electronic currencies, amongst other allegations.
“Potential buyers in digital asset securities are entitled to know if promoters ended up compensated by the issuers of all those securities,” explained Kristina Littman, the SEC’s cyber device main. “McAfee, assisted by Watson, allegedly leveraged his fame to deceptively tout quite a few electronic asset securities to his followers with no informing traders of his role as a paid promoter.”
(Reporting by Katanga Johnson and Sarah N. Lynch in Washington, D.C. More reporting by Ayanti Bera in Bengaluru Enhancing by Anil D’Silva, Cynthia Osterman and Richard Chang)