US charges anti-virus software pioneer John McAfee with cryptocurrency fraud

John McAfee — the antivirus software pioneer whose former company still carries his name — has been charged with securities fraud over a so-called “pump and dump” scheme involving cryptocurrency.

McAfee and his bodyguard Jimmy Gale Watson Jr are facing allegations of promoting cryptocurrencies to McAfee’s massive Twitter followers to jack up prices.

The duo amassed around $2 million from the cryptocurrencies like Reddcoin and Dogecoin that they allegedly sold, prosecutors said.

They also allegedly made a further $11 million in payments from cryptocurrency start-ups for promoting their digital assets on social media, payments which were not disclosed to investors who acquired them.

Lies and deception

“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 Verge quoted US Attorney Audrey Strauss as saying in a statement.

Legal counsels for McAfee could not immediately be identified. McAfee — who ran for U.S. president twice — is being detained in Spain after his arrest in the country on tax evasion charges announced in October, the Justice Department said. Watson was arrested Thursday night in Texas, the department added.

McAfee and Watson are facing charges of wire fraud conspiracy, commodities and securities fraud conspiracy, wire fraud, and money laundering conspiracy, according to CNBC.

Still developing cybersecurity products

McAfee, 75, quit the antivirus company that he founded in 1994. In 2013, he created a profane parody video explaining how users can uninstall antivirus software.

Six years later, he was ordered to pay $25 million in damages over the death of a former neighbor in Belize in 2012. McAfee left Belize out of fear for his own safety. Authorities ultimately said he was not a suspect.

McAfee came to prominence in the 1980s when his company released the first commercial anti-virus software — McAfee VirusScan — that led to a multi-billion dollar industry. Although Intel has since bought that business, McAfee still develops cyber-security products of his own.

 

Image courtesy of j aubrey/YouTube Screenshot

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