John McAfee Linked Bitcoin Mining Firm Hit With Lawsuit Over Pump-and-Dump Scheme
MGT Capital Investments, a bitcoin mining and cryptocurrency investing firm formerly associated with John McAfee, has been hit with a class-action lawsuit over allegations that its former CEO participated in a pump-and-dump scheme that manipulated the price of MGT shares.
The bitcoin mining and investing company were formerly associated with John McAfee, the antivirus pioneer turned cryptocurrency evangelist. McAfee left the company in August 2017. The plaintiffs claim monetary losses caused by purchasing artificially priced shares.
The lawsuit was filed by Rosen Law Firm on behalf of MGT shareholders. The class action lawsuit includes anybody who purchased shares of MGT between October 2015 and September 2018.
The pump-and-dump scheme consisted of a group of 10 investors and corporate executives including Ladd, former Riot Blockchain CEO John O’Rourke (who also tendered his resignation), and billionaire Phillip Frost, who allegedly conspired over a period of several years to generate more than $27 million in unlawful stock sales by manipulating the prices of penny stocks.
The suit requests that the court order MGT to pay damages to shareholders affected by the manipulation of MGT shares, cover the plaintiff’s court costs, and award further relief to aggrieved parties.
Neither MGT Capital Investments nor John McAfee is specifically mentioned in the investigation, but they are in the private lawsuit, which is heavily based on the SEC complaint.
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