By Jonathan Stempel and Chris Prentice
NEW YORK / WASHINGTON (Reuters) – John McAfee, the pioneer of antivirus software whose former company still bears his name, is being charged with fraud and money laundering as a result of two cryptocurrency schemes, the U.S. Department of Justice said Friday.
Authorities accuse McAfee and his bodyguard, Jimmy Gale Watson Jr., of exploiting McAfee’s large Twitter to artificially increase the prices of ‘altcoins’ through a so-called pump-and-shower scheme, and the concealment of payments McAfee received from start-ups to promote start-ups. coin offers.
The Department of Justice said McAfee and his accomplices had raised more than $ 13 million from the schemes. The charges were brought in federal court in Manhattan.
The Commodity Futures Trading Commission has filed related civil charges with the alleged pump-and-shower scheme.
U.S. Attorney Manhattan Audrey Strauss said in a statement: “As alleged, McAfee and Watson have used a widely used social media platform and enthusiasm among investors in the emerging cryptocurrency market to make millions through lies and deception.”
Lawyers for McAfee could not be immediately identified. McAfee is being held in Spain after his arrest there on charges of tax evasion announced in October, the justice department said.
Watson was arrested Thursday night in Texas, the department added.
Arnold Spencer, Watson’s attorney, said in a statement: “Jimmy Watson is a decorated veteran and former Navy Seal. He fought for the rights and freedoms of others, and he is entitled to and looking forward to his day in the court to exercise some of those rights. “
Both are also facing civil charges by the U.S. Securities and Exchange Commission, which accused McAfee in October of hiding more than $ 23.1 million he made by posting seven cryptocurrency listings on Twitter.
In the cases of cryptocurrency, authorities said McAfee featured assets, including Verge, Reddcoin and Dogecoin, as part of a “Coin of the Day” or “Coin of the Week” tweet from around December 2017 to February 2018.
According to authorities, McAfee has established itself as an expert on cybersecurity and cryptocurrency through his tweets, speeches and his role as CEO of a listed cryptocurrency company. They also accused him of telling followers that he had no interest in the coins, even though he said how they would ‘change the world’.
(Reported by Jonathan Stempel in New York and Chris Prentice in Washington; edited by Matthew Lewis and Will Dunham)