Successful boxer Floyd Mayweather and famed music producer DJ Khaled were each acquitted by a lawsuit filed by investors who have been victims of a fraudulent Initial Coin Offerings (ICO). This is apparent from court documents of 13 May.
The two celebs had previously advertised Centra Tech’s corresponding ICO, but the court has now decided that the prosecution failed to demonstrate that the defendants’ promises were crucial to investor investment. The court documents refer to a Twitter entry in which Mayweather has published a picture in which he holds a bank card of the said company in his hand.
Furthermore, before the start of the ICO, the boxer had appealed to one of his fans that they should secure the Centra Tech tokens “before they are sold out”. He himself would have bought the tokens.Judge Robert Scola has nonetheless come to the conclusion that the plaintiffs were unable to demonstrate clearly that Mayweather’s Twitter messages were crucial to their investment. Rather, the judge points out that two of the plaintiffs had already bought their CTR tokens before Mayweather even got involved in the ad campaign.
Also DJ Khaled, who had touted the crypto project on Instagram, was acquitted on the basis of a similar conclusion.The US Securities and Exchange Commission (SEC) once again blamed the two celebrities last November for unlawfully promoting the ICO. Accordingly, Mayweather would not have properly reported a compensation of $ 100,000, while Khaled had concealed $ 50,000, the funds had flowed from Centra Tech.As part of an out-of-court settlement, which is not an admission of guilt by the two prominent figures, Mayweather was ordered to pay a fine of US $ 600,000, whereas DJ Khaled only had to pay a fine of US $ 150,000.
The SEC has repeatedly warned the public against ICOs advertising familiar faces. If celebs do not properly report compensation, it could well be an illegal crypto project.In April 2018, the SEC arrested and charged three founders of Centra Tech for fraud. The charge was related to the aforementioned ICO and had a dispute of more than $ 25 million. The company had previously claimed that the proposed crypto bank card is supported by Visa and Mastercard, but later found out that there had been no such agreement with the major credit card providers. The startup would have deliberately acted fraudulently with its marketing measures.