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Celebrities and scam ICOs: the case of T.I.’s cryptocurrency
Celebrities and scam ICOs: the case of T.I.’s cryptocurrency
Security

Celebrities and scam ICOs: the case of T.I.’s cryptocurrency

By Eleonora Spagnolo - 19 Sep 2020

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The rapper T.I. was fined by the SEC for promoting a cryptocurrency scheme that turned out to be a scam. It was FLiK, a token linked to an ICO dated 2017.

It was the period of the speculative bubble when the crypto industry was being flooded with Initial Coin Offerings, with projects that were often fantastic, but only on paper.

T.I. would have got into one of these. According to the reconstruction of the SEC, from September 2017 the rapper (whose real name is Clifford Harris Jr) started promoting FLiK, created by film producer Ryan Felton.

FLiK, according to the informational material of the time, was supposed to be the basic token for a blockchain-based streaming platform. A sort of Netflix

Investors who bought the token were promised that FLiK would grow in value, and could be used to take advantage of the platform’s content. Alternatively, it could be sold. 

However, this phantom platform was never created.

T.I. and the phantom cryptocurrency

For this reason, the SEC intervened against Ryan Felton and the rapper T.I..

T.I. would have promoted the FLiK cryptocurrency on his social channels, with posts referring to the website where the investment could be made. According to the SEC, those posts were even more successful than the campaigns sponsored by FLiK itself, which for their part reached thousands of users in the United States. This is because at the time T.I. had millions of followers on his social channels.

The revenue raised was considerable. But according to the SEC, Ryan Felton did not invest it to create the promised platform. Rather, along with funds embezzled from another ICO he was responsible for, CoinSpark, he bought a Ferrari, a million-dollar villa and various luxury goods including diamond jewellery. 

This was enough for T.I. to be fined $75,000. 

VIPs testimonials of crypto scams

T.I.’s story is not isolated. There are several celebrities who would have promoted cryptocurrencies, tokens and ICOs, which later turned out to be scams or projects of little value.

This is the case of Steven Seagal. The actor was sentenced to a $314,000 fine for promoting the Bitcoiin crypto. The name is quite misleading: despite its resemblance to the queen of cryptocurrencies, Bitcoiin (B2G) after a rapid rise, is now worthless.

The complaint against Steven Seagal is that he promoted Bitcoiin by failing to say that he would be paid to do so.

Two other older cases have seen the SEC fine a boxer and a music producer for promoting Centra Tech and its Centra Token. The VIPs in question are boxer Floyd Mayweather Jr and DJ Khaled

Centra Tech was supposed to issue a cryptocurrency debit card. The founders were arrested for fraud and are currently on trial.

It is also worth mentioning the VIPs who are unknowingly testimonials for Bitcoin’s automated trading platforms, something from which it is best to stay away. 

The scheme is always the same: ads appear on social networks or in banners on authoritative websites where these prominent people are ready to reveal the method that would make them rich. By clicking, users land on what appears to be a real interview in apparently authoritative newspapers. Instead, interviews are fake and newspapers are imitations of the originals

These “articles” refer to Bitcoin’s automated trading platforms. Victims of these advertisements and the related scams were Harry and Meghan, Bill Gates and even the founder of Nutella, to name but a few.

Lastly, in this roundup of VIPs involved in scams, it is worth mentioning the Twitter hack. On that day, the Twitter accounts of Bill Gates, Barack Obama, Elon Musk, Joe Biden and others were hacked and they all announced that they were giving Bitcoin to those who sent them some funds: they would double it back. 

The scam generated about 110 thousand dollars, but then the young promoters were arrested

 

Eleonora Spagnolo
Eleonora Spagnolo

Journalist passionate about the web and the digital world. She graduated with honours in Multimedia Publishing at the University La Sapienza in Rome and completed a master's degree in Web and Social Media Marketing.

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