Clifford Harris Jr., better known as T.I., has been ordered by the Securities and Exchange Commission to pay $75,000 for his involvement with an unregistered and fraudulent initial coin offering (ICO).
According to a news release by the SEC, Harris promoted one of two fraudulent ICO ventures headed by producer Ryan Felton. At least three other individuals were also involved.
The SEC said Felton promised to use investor money to develop the two companies that conducted the ICOs: FLiK and CoinSpark. He said he would build a digital streaming platform for FLiK and a digital asset trading platform for CoinSpark.
Instead, he used funds to buy a Ferrari, a $1.5 million home, jewelry and other luxury goods. Felton also employed manipulative trading to inflate prices and profits.
The SEC said Harris encouraged his followers on social media to buy FLiK tokens and invest in the ICO. He also allegedly asked “a celebrity friend” to promote the venture and falsely claimed to be co-owner of Felton’s company. Some speculate the famous friend was Kevin Hart.
Harris doesn’t face criminal penalties but was ordered to pay the $75,000 civil monetary penalty and cannot participate in offerings or sales of digital asset securities for at least five years.
He has not publicly commented on his involvement in the fraud.
Felton is the only one of the five individuals named by the SEC who has not agreed to settlements to resolve the charges against them. The FBI is investigating the case.