T.I. has been ordered to pay a fine of $75,000 (£58,000) for his part in a fraudulent cryptocurrency case.
The Securities and Exchange Commission (SEC) has charged the rapper with promoting fraudulent initial coin offerings (ICOs) in connection with a company called FLiK.
He was accused of offering and selling FLiK “tokens” on his social media accounts and encouraging his followers to invest in the FLiK ICO. He was also accused of falsely claiming to be a co-owner of the company.
According to a press release from the SEC, “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.’”
The Atlanta rapper’s social media manager, William Sparks, Jr., was also accused of offering and selling FLiK tokens via T.I.’s social media accounts.
T.I. agreed to “pay a $75,000 civil monetary penalty and not participate in offerings or sales of digital-asset securities for at least five years.”
The SEC brought charges against four other Atlanta residents, including the film producer Ryan Felton and three others accused of promoting Felton’s fraudulent ICOs. The two companies involved, FLiK and CoinSpark, were also charged. All but Felton have agreed to settle.
“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.
“As alleged in the SEC’s complaint, Felton victimised investors through material misrepresentations, misappropriation of their funds, and manipulative trading.”
In February, T.I. was removed as a defendant in a 2018 civil suit filed by investors. The suit, which also names Felton and comedian Kevin Hart, is ongoing, currently delayed by the coronavirus pandemic, according to court documents.
Back in June, the organisation acknowledged its previous ties to the slave trade. As reported in the New York Times, it later pledged to make changes including the recruitment of more BAME employees and donating to charities that support diversity and inclusion.
However, in a new two page letter, T.I. has said the apology doesn’t go far enough and the organisation needs to consider reparations.