John McAfee indicted for crypto pump and dump schemes, illegal ICO promotion

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John McAfee has been indicted in the Southern District of New York on crypto-related charges, according to the U.S. Attorney's Office for the Southern District. 

The charges include conspiracy to commit securities fraud, wire fraud conspiracy and money laundering conspiracy for activity related to his cryptocurrency venture the "McAfee Team."

Jimmy Watson, the executive adviser of the McAfee Team, is also facing charges. Law enforcement arrested him last night in Texas. Meanwhile, McAfee is currently detained in Spain on separate tax evasion charges filed last year by U.S. prosecutors, for which extradition to the United States is being sought.

McAffee and Watson allegedly used Twitter to build interest in various digital assets through "false and misleading statements," resulting in gains of more than $13 million. The indictment accuses the two of engaging in pump and dump schemes, purchasing publicly traded coins and then endorsing them to drive up the price before selling for financial gain. Prosecutors also alleged the two promoted initial coin offerings (ICOs) on their accounts without adequately disclosing their investments or positions.

“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," Manhattan U.S. Attorney Audrey Strauss said in a statement.

McAfee and Watson could face prison time, as each count of the indictment carries a maximum sentence of at least five years. They also carry possible financial penalties. 

In a parallel action, the CFTC filed suit Friday against McAfee and Watson in connection with the alleged pump-and-dump schemes. 

The SEC has already brought a civil case against McAfee, seeking disgorgement and civil penalties related to his ICO activity.

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