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SEC Imposes A Lifetime Ban & Fines On John McAfee's ICO Partner
A federal judge ruled in the agency's favor while agreeing to dismiss claims against the late former tech mogul.
Ankita K.
5:09 16th Jul, 2022
Policy

The Securities and Exchange Commission today announced a final consent judgment against Jimmy Gale Watson, Jr., an associate of the late John McAfee, for his role in an alleged ICO scam.

In October 2020, after Spanish authorities arrested McAfee, the SEC filed a complaint alleging that the one-time antivirus pioneer promoted investments in ICOs with Watson's help, without disclosing that they were paid to do so.

According to the agency, Watson assisted McAfee by negotiating the promotion deals with the ICO issuers and helped McAfee cash out the crypto payments received.

The SEC also accused McAfee and Watson of engaging in pump and dump schemes, secretly accumulating a large position in a cryptocurrency, and then promoting it on Twitter with the intention to sell it as the price rose.

The final judgment against Watson permanently bans him from buying, selling, or offering digital assets in a professional capacity and assesses a fine of $316,401.48 plus prejudgment interest of $59,533.38, for a total penalty of over $375,000.

According to the notice, Watson can continue buying and selling digital assets "for his personal accounts."

The court also filed a Notice of Death concerning McAfee, dismissing the agency's claim against the late tech mogul. According to the court, the order to dismiss only applied to McAfee and not Watson.

In March 2021, McAfee declared that the SEC "allegations are overblown." Three months later, he was found dead in a Spanish prison from an apparent suicide—a conclusion that his family denies. McAfee had been on the run for months after being charged with tax evasion and promoting seven initial coin offerings (ICOs) that U.S. authorities described as "pump-and-dump" schemes that allegedly made McAfee over $23 million.

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