Floyd Mayweather & DJ Khaled Sued Over ICO InvolvementOctober 23, 2018
Earlier this year, legal experts warned that celebrity ICO endorsers would be looking at court time in the near future. Now, it’s come to pass that a lawsuit has been filed against some of the biggest names in current pop culture.
In the red corner is the boxing champion himself, Floyd ‘money’ Mayweather and the in the blue corner is the world known music producer, DJ Khaled… and both of them have been slapped with a lawsuit.
The lawsuit has been filed by people who have lost their money by investing in the Centra Tech initial coin offering. The celebrities have endorsed the ICO on social media with the boxing champ nicknaming himself ‘Floyd Crypto Mayweather’ and the music producer calling the ICO a game changer.
In the suit, the accusers allege that partly as a result of the efforts put in by Khaled and Mayweather, Centra Tech managed to raise around $32 million USD in the ICO which was floated last year. The accusers now want to be compensated for their losses as well as damages by founders of the firm and the by boxer and producer.
Back in May this year, the US Attorney’s Office for the Southern District of New York now raises the stakes for the founders of the company who were indicted with four counts of fraud including, securities fraud, conspiracy to commit fraud and so on.
The accusations aimed at the company also includes the founders of the firm, Robert Farkas, Raymond Trapani and Sohrab Sharma being accused of making material omissions and misstatements with a view of deceiving investors.
“…the defendants conspired to capitalize on investor interest in the burgeoning cryptocurrency market. They allegedly made false claims about their product and about relationships they had with credible financial institutions…”
The FBI even got involved and arrested the men behind the firm and resulted in over 90,000 ETH being seized too. Now, that would be worth around $18 million but back then it would have been worth almost $70 million.
According to CCN:
“The class-action lawsuit against DJ Khaled and Floyd Mayweather does not come as a complete surprise as the U.S. Securities and Exchange Commission (SEC) had already warned last year that celebrity ICO endorsements could be considered unlawful if they failed to meet certain standards.”
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