The U.S. Department of Justice has indicted cryptocurrency baron John McAfee on charges of securities fraud, wire fraud, and money laundering.
Jimmy Gale Watson, the executive advisor of McAfee's cryptocurrency team, was also arrested in Texas on March 4.
In her statement, Manhattan U.S. Attorney Audrey Strauss claims that the two used social media to make a fortune through "lies and deception.":
As alleged, 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. The defendants allegedly used McAfee’s Twitter account to publish messages to hundreds of thousands of his Twitter followers touting various cryptocurrencies through false and misleading statements to conceal their true, self-interested motives. .
Two fraudelent schemes
The DOJ's press release stated that the crypto baron came up with two fraudulent schemes to tout cryptocurrencies.
One of them involved pumping and dumping tokens with the help of false advertisements on Twitter.
The other one consisted of promoting initial coin offerings in exchange for "secret compensations":
Furthermore, in several instances during this ICO touting scheme, MCAFEE and WATSON took active steps to conceal their secret compensation arrangements with ICO issuers from ICO investors, and MCAFEE made false and misleading statements and omissions to hide such deals from ICO investors.
The antivirus software veteran was originally indicted by the DOJ on charges of tax evasion back in October.
McAfee is currently detained in Spain pending extradition to the U.S.