SEC Charges Rapper Clifford Harris Jr.Producer Felton for Fraud

Andrew Cummings
September 14, 2020

Grammy Award-winning hip-hop artist T.I. has been charged by the U.S. Securities and Exchange Commission (SEC) for allegedly promoting an unregistered and fraudulent ICO.

Grammy award-winning rapper Clifford Harris, known as T.I., agreed to pay a US regulator $75,000 to settle charges that he broke securities laws by selling fraudulent crypto-currency investments, the agency said on Friday.

The SEC indicated that Felton misappropriated those invested funds by using them for personal items.

It would seem T.I. left a paper trail.

A Friday press statement from the SEC detailed two fraudulent preliminary coin offerings- one for a digital streaming service FLiK and another for a trading platform called CoinSpark, with Atlanta-based movie producer Ryan Felton presumably raised funds. Moreover, the SEC claims Felton also conducted a scheme to manipulate the price of the SPARK tokens.

Disgruntled investors ended up suing T.I. and Felton back in 2018 but the securities fraud charges against him were later dismissed by a Georgia judge.

The SEC also indicated that Felton raked in an additional $2.2 million in profits after transferring some FLiK tokens to himself and then selling them to investors. T.I. also asked a celebrity friend to promote the FLiK ICO on social media and provided the language for posts, referring to FLiK as T.I.'s "new venture".

SEC alleged that in 2017, T.I. on his social media account promoted and sold Flix tokens and claimed to be the co-founder of the company.

As per SEC, producer Felton used the ICO money for personal expenses such as a Ferrari auto, multi-million-dollar home and other expensive merchandise.

"The federal securities laws provide the same protections to investors in digital asset securities as they do to investors in more traditional forms of securities, ” said Carolyn M. Welshhans, Associate Director in the Division of Enforcement". White and Smith are charged with violating registration and anti-touting provisions. The trio will also not participate in any digital securities in any manner for five years. He's facing criminal charges.

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