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John McAfee’s ICO partner gets lifetime ban, $375K fine in SEC case ruling

A lawsuit by the U.S. Securities and Exchange Commission (SEC) against John McAfee and his partner in crime has concluded. In a court ruling in New York, McAfee’s partner Jimmy Gale Watson was handed a lifetime ban from dealing professionally in digital assets as well as a $375,000 fine.

The Southern District of New York entered a final consent judgment against Watson in connection with his role in the McAfee ICO promotion scheme, the culmination of the SEC’s action against him and the deceased computer antivirus pioneer that started back in October 2020.

The securities regulator alleged that McAfee would get into deals with ICO projects in which he would promote them on his social media accounts and drive up interest in them, consequently pumping their tokens. However, unbeknown to his followers, he was receiving a massive amount of tokens on the side as payment, and after pumping them, he would dump his share of tokens and make a handsome profit. Pump-and-dumps are illegal in the securities industry, with the SEC and the Financial Industry Regulatory Authority (FINRA) enforcing measures against it.

According to the consent judgment, while McAfee was the face of the illegal pump-and-dump, it was Watson who was pulling the strings behind the scenes. Watson is alleged to have been the one who negotiated the deals with the ICO issuers and even helped McAfee cash out the digital asset payments, a charge he denied in March 2021.

The final judgment orders Watson to pay a disgorgement of $316,401.48 and prejudgment interest of $59,533.38, totaling to just over $375,000. He is also permanently barred from participating in the issuance, purchase, or sale of digital assets professionally, although he can do it personally.

Along with the consent judgment against Watson, the SEC filed a Notice of Death on McAfee, resulting in the dismissal of the action against him. 

As CoinGeek reported, McAfee was found dead in a prison cell in Barcelona, Spain, a year ago in what was ruled to be suicide although his widow Janice McAfee has maintained that the controversial former NASA programmer was murdered. McAfee had also made several claims that he believed he would be murdered and that it would be made to look like he had committed suicide, going as far as tattooing “$Whackd” on his arm in reference to this belief.

Even in death, McAfee is still a subject of global interest as the age-old question of whether he was a tech revolutionary, a digital currency scammer, or both continues. Earlier this year, his life as an NFT was released on the BSV blockchain via the publishing platform Canonic

Follow CoinGeek’s Crypto Crime Cartel series, which delves into the stream of groups from BitMEX to BinanceBitcoin.comBlockstreamShapeShiftCoinbaseRipple,
EthereumFTX and Tether—who have co-opted the digital asset revolution and turned the industry into a minefield for naïve (and even experienced) players in the market.

New to Bitcoin? Check out CoinGeek’s Bitcoin for Beginners section, the ultimate resource guide to learn more about Bitcoin—as originally envisioned by Satoshi Nakamoto—and blockchain.

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