Retired boxer Floyd Mayweather Jr. alongside producer DJ Khaled are both stuck in an unfortunate situation because of a noteworthy claim brought against them by financial specialists who were ripped off by a cryptocurrency scam created by a company called Centra Tech.
Mayweather and Khaled gave their public celebrity endorsement for the fake Centra cryptocurrency system. Mayweather promoted Centra’s initial coin offering (ICO) to his millions of followers on social media by encouraging them during September 2018, to buy the Centra cryptocurrency.
Blockchain Reporter said that Centra was marketed as being a system that worked with many cryptocurrencies in partnership with MasterCard and Visa. Supposedly, owners of the Centra cryptocurrency would be able to make purchases using Centra MasterCard and Visa debit cards at over 36 million global merchants. The first sign of a serious problem with the company was that those MasterCard and Visa debit cards were never issued.
At the point when Centra went bankrupt, in the wake of raising around $32 million from its ICO, Centra’s originators, Sohrab “Sam” Sharma and Robert Farkas, were sued by the Securities and Exchange Commission (SEC). The SEC asserts in the claim that the cases made by Centra that the organization had manages MasterCard and Visa were false. Besides, the SEC says that the official group recorded on the organization’s site did not exist. The SEC likewise charges that the organization’s originators controlled the cost of the Centra digital money to cheat speculators while unlawfully offering it as an unregistered security.
After the lawsuit was filed against them by the SEC in federal court in New York, the SEC also filed criminal charges against the founders. Farkas was caught and arrested trying to board an airplane to flee the United States. Farkas and Sharma were charged with securities fraud, conspiracy, wire fraud, and other criminal charges. Finance Magnates reported that later a third defendant, Raymond Trapani, was arrested. The SEC claims that Trapani was the secret mastermind behind the whole scam.
Neither Khaled or Mayweather appears to be facing criminal charges over the Centra case; however, the SEC has clearly stated that celebrities are not shielded from legal action against them when they promote fraudulent investments.
Investors may have a difficult time getting their money back because the founders of Centra squandered the $32 million that they raised. The only hope for investors is that they can squeeze money from a settlement or an award that comes from the class action lawsuit naming Mayweather and Khaled.
Mayweather got over $100 million from his last major fight.Nevertheless, he owes the IRS over $23 million in bank taxes and announced to the IRS that he can’t pay it. This implies any clams against Mayweather should hold up until after he pays the IRS.