ryan felton

Ryan Felton was indicted on September 12, 2020, by a federal grand jury for his role in a fraudulent crypto scheme. Felton was indicted for his role in promoting a pair of ICO for two companies – CoinSpark and FLiK. 

The Details of the Indictment

According to an announcement by the DoJ, Felton has been indicted on charges related to two crypto-based investment projects. The indictment states that in 2017 and 2018, Felton aggressively promoted ICOs for two companies, CoinSpark and FLiK through various online platforms.

FLiK was marketed as a content streaming platform while CoinSpark was supposed to operate as a crypto trading platform. To pump the price of the tokens, Felton made various false allegations and material missions before, during, and after the ICOs.

For instance, Felton told potential investors that the funds from the ICO would be used to support the development and launch of the purported platforms. He also claimed that private investors had made a huge investment in his projects.

To convince his victims, Felton posed as one of the potential investors using fake names on various forums online. He used these fake identities to promote the project and pump up excitement around CoinSpark.

Once the ICO was over, Felton secretly sold off most of his coins on various markets. He took advantage of the price pump efforts to make millions from the sale of the tokens. Eventually, he moved the funds to his personal accounts for his personal uses.

According to the indictment, most of the funds went to funding his personal lifestyle. Felton is accused of buying a $1.5 million home with part of the proceeds in an all-cash purchase. Besides that, he made an all-cash purchase of a $180,000 Ferrari 599 GTB Fiorano Coupe.

The Federal Government is seeking to have Felton forfeit the properties and luxury items he bought with the funds as proceeds of crime. In line with this, it had filed a civil forfeiture action, which has been stayed until the criminal prosecution has been resolved.

Rapper T.I. Caught Up in the Scandal

Ryan Felton’s fraudulent scheme also had rapper T.I. entangled in the scheme. According to an SEC document, T.I., whose real name is Clifford Harris Jr., was charged in a civil suit for helping to promote the FLiK ICO.

The SEC alleged that T.I. made various social media posts in which he actively encouraged his followers to invest in the scam project. He also actively asked his celebrity friends to promote the scam to their followers.

However, T.I. was not indicted. Instead, he chose to settle with the SEC for his role in the project. He was ordered to pay a $75,000 fine for his role in the project. Besides that, his social media manager Sparks Jr. and two other men have to pay a $25,000 fine each.

It is not the first time celebrities are being caught up in a crypto scam. For instance, the SEC agreed to settle with actor Steven Seagal for his role in promoting a crypto scam in February 2020. In general, before you sign up for a project being promoted by a celebrity, you have to conduct due diligence to ensure that it is genuine and you will not lose your funds. Sometimes, they too fall prey to fraudulent crypto scams.

Image Source: Unsplash

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